Macroeconomics Test

aggregate demand.

Congress and the President have control of the tax system and government spending. As a result, their policies will directly impact...

not counted at all.

A 15-year-old that wants a job but can't find one is...

aggregate demand to the right.

A weakening of the dollar will immediately shift...

AD to decrease (move to the left).

An increase in taxes will cause...

labor for participation rate steadily fall.

As the baby boom starts to retire, you would expect to see the...

"$" for the amount borrowed/saved.

Assuming that Figure 7.1 is a market for money that can be borrowed or saved, Box 6 is...

either the ways people earn money or the ways people spend money.

GDP can be calculated using...

It is not counted at all.

How does GDP deal with a Ford produced in Mexico?

D

In figure 6.1, which area represents a recovery?

aggregate supply curve.

The notion of the "classical range" was one of the basic parts of the...

(110-100)/100*100%=10%

If a market basket was defined in 2018 and it cost $10,000 to purchase the items in that basket in 2018, while it cost $11,000 to purchase those identical goods in 2019, then the inflation rate from 2018 to 2019 is...

cyclically unemployed.

If a person is laid-off from a job and told that they will be brought back as soon as the economy picks up and demand for their product rises, then economists call this person...

an increase in the interest rate will cause the investment to be less profitable, but it may still make money.

If an investment (where the costs are incurred before then profits) makes sense when the interest rate on the borrowed money to pay for it is 10%,

be less than $1,000 x 20 ($20,000).

If payments of $1,000 are to be received every year for 20 years and the interest rate is positive, the present value of this stream will...

3%.

If the inflation rate is 2% and the real interest rate is 1% then the nominal interest rate is around...

borrowers.

If the inflation rate turns out to be greater than was expected to be, the clear losers are...

overstating inflation because they were missing "where people shop".

In the 1970s and 1980s, Wal-Mart entered several markets outside of its home base of Arkansas. As a result, it brought lower prices on a variety of goods. The Bureau of Labor Statistics did not send its shoppers into these new stores until there was a new survey, leading to the CPI...

demand curve.

In the market for money, the behavior of borrowers is represented by the...

it ignores the value of leisure.

One of the reasons that Real Gross Domestic Product is not synonymous with social welfare is...

supply-side policies

Policies focused on putting people to work by reducing the costs to their employers would be considered...

$250 million.

Suppose a Boeing 777 is sold to a Chinese company for $250 million and resells it to a Hong Kong airline for $251 million. GDP will count this as...

It is $5.

Suppose an apple pie sells at a grocery store for $5. Suppose that the grocery store purchased it from a baking company for $4. Suppose the baking company paid $2 for ingredients, $1 for labor, and made $1 in profit. What is the GDP contribution of the pie?

10%.

Suppose there are only two goods (Good A and Good B) and the average person buys 8 of Good A in a year and 6 of Good B. If, in the base year, the Price of Good A is $8 and the price of Good B is $6, and in the next year the Price of Good A is $10 and the Price of Good B is $5, the inflation that occurred in the second year is...

all prices as measured by the CPI and production as measured by real GDP.

The aggregate supply-aggregate demand diagram relates various levels of...

The fact that it is a measure of value.

The fact that you can use money to compare the value of one good to another is a result of which characteristic?

default risk.

The form of risk to the lender associated with a borrower not paying their debt is called...

to avoid double counting goods that are sold so as to be resold.

The reason that only final sales are counted in GDP is...

two consecutive calendar quarters.

Traditionally, a recession defined by declining Real GDP lasts over a period of at least...

3.3% (((174.0-168.3/168.3)*100%)

Using table 6.1, the inflation rate for 2000 would be...

The imposition of a 35-hour work week

Which of the following might create cost-push inflation?

A cut in taxes

Which of the following policies might create demand-pull inflation?

a decrease in productivity

Which of the following will increase macroeconomic equilibrium prices?

an increase in productivity

Which of the following will increase macroeconomic equilibrium real gross domestic product?

AS to decrease (move up and to the left).

A decrease in productivity will cause...

increases the motivation to delay consumption and, therefore, save.

A higher interest rate...