Econ Exam (11-12)
The country of Russia had a Gross Domestic Product of about $4 trillion in 2016 and a population of 142 million people, the GDP per capita would be ________.
$28,000
Calculate the unemployment rate based on the following data for a country: Population: 200, Employed workers: 140, Labor Force: 160, Discouraged workers: 10.
12.5%
Jenny can paint one birdhouse in 2 hours and can build one birdhouse in 1 hour. Gary can paint one birdhouse in 3 hours and can build one birdhouse in 2 hours. Who has the comparative advantage in painting a birdhouse? (HINT: To determine the opportunity cost, divide the hours of painting by the hours of building. The one with the lowest opportunity cost has the comparative advantage.)
Gary
Real GDP measurements are
Adjusted for inflation
With a Consumer Price Index of 179.8 at the end of last year and 186.5 at the end of this year, the country experienced which of the following?
An inflation rate of 3.72 percent.
What term refers to a nation's transactions in the form of imports and exports with any other single nation or rest of the world.
Balance of Trade
Why do governments impose trade barriers?
Both to protect domestic industries and to combat job losses
What is the term to describe when a nation or individual can produce a good or service at a lower opportunity cost than another nation or individual?
Comparative Advantage
Since the U.S. has so many resources why do we trade with other countries?
Comparative advantage
What happens when the value of the currency changes and you can purchase more of the other currency?
Currency appreciates
The Balance of Payments includes three accounts. Which account includes income from foreign investments?
Current Account
David's pay last year was $100,000. His pay this year increased to $115,000. The consumer price index increased from 100 to 115 over the same time period. What has happened to David's real income from last year to this year?
David's real income is unchanged.
Which of the following is NOT a consequence of tariffs?
Domestic products are less expensive
Several nations might agree to jointly issue and use a single currency. Which of these is an example of a common currency?
Euro
What is the term used to describe the price of one nation's currency in terms of another nation's currency?
Exchange Rate
Henry has accepted a new position in the Federal government after working at ball bearing manufacturing plant. He has been put to the task to measure the economic growth as accurately as possible for the nation's last year. What would Henry use in this instance to produce the most accurate growth analysis?
GDP Deflator
Which types of unemployment exist at all times and determine the natural rate of unemployment?
frictional unemployment and structural unemployment
A welder who quits his job and moves from Pittsburgh to Madison to try to get a better welding job is said to be ________.
frictionally unemployed.
The redistribution of purchasing power due to unexpected inflation benefits which group of people?
students with fixed-rate educational loans
The Department of Economic Health in the country of Cavia has calculated the price index for a basket of goods from 2014 to 2018. January 2014 is the standardized price index (at 100) for a basket of consumer goods. The price index increased in 2015 to 105.7, in 2016 to 108.6, in 2017 to 115.9, and in 2018 it increased to 120.4. What are the inflation rates in Cavia for 2015, 2016, 2017, and 2018?
2015: 5.7%; 2016: 2.7%; 2017: 6.7%; 2018: 3.9%
If the number of employed persons in a country equals 24 million, the number of unemployed persons equals 8 million, and the number of persons over age 16 in the population equals 40 million, the unemployment rate equals ________.
25%
If Nominal GDP = $4.5 trillion and the GDP deflator is 150, then real GDP is equal to
3 trillion
In 2005 the price index was calculated at 115.3 with 2000 as the base year. In 2006 the price index increased to 119.5. What was the inflation from 2005-2006?
3.6%
In the far off kingdom of Viracien there is a healthy sized population of citizens over 16 years old. The last census indicated a total adult population of 5 million people. This year a recession hit and 237 thousand people were let go from their jobs and are on the hunt to find new work. Because of the recession many took early retirement and there is now a population of 1.3 million who are not working or looking for various reasons. Because of the unrest, the military of Viracein has increased its ranks and is now grown to a total of 50 thousand citizens serving the country. If Viracein uses the same calculation to find the unemployment rate, what is the country's unemployment rate?
6.5%
Which of the following would be included in Gross National Product?
A dresser made in Mexico by USA furniture direct inc.
Which product should Nation XYZ produce given the following information? They have traditionally been an agricultural nation and have a huge population. The government wants to diversify the economy with a new industry.
Hand-woven place mats
What does comparative advantage measure?
How much each nation gives up in one good to produce another good.
How do trade barriers negatively impact an economy?
Hurt efficient and competitive industries
If the Euro appreciates, how will it impact U.S. purchases in Europe and European purchases in the U.S.?
Increase purchases in U.S. by Europe and decrease purchases in Europe by U.S.
The Krisp Kracker company which makes unique kettle chips for restaurants, clubs, and events, has just lost a large client that made up 55% of its total revenue. Management finds it necessary to reduce staff or wages. This comes only three months after hiring 35 new people to support this big client. While there are rumors of wage reductions in the short run, the 100 employees who have been with the company for the past two years are grumbling that they are more valuable that the new hires which should be let go and the wages not reduced. The situation at Krisp Kracker illustrates which wage stickiness theory best?
Insider-outsider model
Investment in human capital
Is an important source of labor productivity
Which group of people is harmed by the redistribution of purchasing power due to unexpected inflation?
Lenders
Which account is held by a nation's central bank and used to balance deficits and surpluses in the combined other two accounts?
Official Reserves Account
A year ago Parker reached his retirement and left the business to pursue other interests. He is now spending lots of time playing golf and visiting his grandchildren. For purposes of employment he is considered:
Out of the labor force
Which of the following best describes a business cycle?
Periods of increasing and decreasing real GDP
When calculating GDP, investment refers to the
Purchase of new capital goods like equipment nand inventories
If the print media is taken over by the electronic media, thereby causing employees in the print media industry to be permanently laid off, ________ unemployment would increase.
Structural
What is excluded from the official calculation of the unemployment rate?
Students who are attending to school full time and not working.
The exchange rate is determined by what?
Supply and Demand
Which of the following trade barriers is a special tax on imports?
Tariff
What is the definition of opportunity cost?
The next best alternative that you give up.
What does the unemployment rate measure?
The percentage of the labor force whom do not have a job, but are looking for one
Labor productivity is
The production or output per worker per hour
In his Macroeconomics class, Louis is working on a project for which he needs to understand the state of the U.S. economy. Which of the following is an economic indicator that Louis could use to help him with this task?
The unemployment rate
What is it called when imports exceed exports?
Trade Deficit
What is it called when exports exceed imports
Trade Surplus
Gross Domestic Product (GDP) is designed to measure:
a nation's total production of final goods and services.
Cyclical unemployment is caused by the ________ for labor ________ during a recession.
demand; moving to the left
Which of the following goods is likely not to be included in CPI calculations that take 1982-1984 as the base year?
laptop Computers
