Econ-Macro Final Exam

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Economics studies choices that arise from one fact. What is that​ fact?

wants exceeds the resources available to satisfy them

when a firm decides to produce organic fruit rather than non-organic fruit, it is answering the question of?

what

who gets the goods and services that are produced, answers the question of?

whom

The labor force participation rate is the percentage of the​ _____ who are members of the labor force.

working-age population

The core inflation rate is the annual percentage change in the​ _____ price index​ _____ the prices of food and energy.

PCE; excluding

In 2000​, the Canadian economy was at full employment. Real GDP was $940 billion. The nominal interest rate was 7.0 percent a​ year, the inflation rate was 4.0 percent a yearcomma the price level was 1.10​, and the velocity of circulation was 11.00. What was the quantity of money in Canada​?

$94.0 billion

Michael is an Internet service provider. On December​ 31, 2012​, he bought an existing business with servers and a building worth ​$300,000. During 2013​, he bought new servers for ​$500,000. The market value of his older servers fell by ​$150,000.

-Michael's gross investment during 2013 was ​$500,000. -​Michael's depreciation during 2013 was ​$150,000. ​-Michael's net investment during 2013 was ​$350,000. ​-Michael's capital at the end of 2013 was ​$650,000.

The people on Coral Island buy only juice and cloth. The CPI basket contains the quantities bought in 2016. The average household spent ​$60 on juice and ​$30 on cloth in 2016 when the price of juice was ​$2 a bottle and the price of cloth was ​$5 a yard. In the current​ year, 2017, juice is ​$4 a bottle and cloth is ​$6 a yard. Calculate the CPI and the inflation rate in 2017.

-The CPI in 2017 is 173.3 -The inflation rate in 2017 is 73.3%

The Bureau of Labor Statistics reported that in June 2003​, the labor force was 147.8 ​million, employment was 138.5 ​million, and the​ working-age population was 221.3 million. Calculate the unemployment rate and the labor force participation rate for that month.

-The unemployment rate was 6.3 percent. -The labor force participation rate was 66.8 percent.

The Fed threw a lot of money at the financial crisis in 2008 to unfreeze credit markets and encourage economic activity. As part of its effort to keep the interest rate​ low, the Fed purchased government bonds worth​ $300 billion between March and September 2009. By​ October, the Fed held​ $770 billion in government​ securities, nearly double its​ pre-crisis total. Before the​ crisis, the Fed held mainly government​ securities, which it used to control the quantity of money in the economy. Now government securities make up just​ 35% of the​ Fed's balance sheet. When the Fed purchases government​ securities, bank reserves​ ______ and bank deposits​ ______. The quantity of money​ ______ and the nominal interest rate​ ______.

-increase; increase -increase; falls

the factor of production __________.

-land earns rent -labor earns wages -capital earns interest -entrepreneurship receives profit or incurs loss

In an​ economy, the currency drain is 10 percent of deposits and the desired reserve ratio is 5 percent of deposits. If the central bank buys​ $100,000 of securities on the open​ market, calculate the money multiplier.

7.3

______ good is used as a component of a final good. We​ ______ add the value of intermediate goods produced to the value of final goods to measure GDP.

An​ intermediate; do not

Aqua Springs makes the following four statements about bottled spring water. Which statement best describes the​ firm's quantity supplied in the bottled water​ market?

At a price of​ $1 gallon, we plan to sell​ 2,000 gallons per day.

Who in the following statements is a discouraged worker​?

Dan is available to work but has not looked for a job in the past eight weeks because of repeated applications but no single offer.

Who in the following statements is a ​full-time worker and who is a ​part-time worker​?

Dan works at Subway for 8 hours each day from Monday through Friday. Mary works at​ Starbucks' for 4 hours each day on weekends.

Which of the following statements describes a change in the quantity supplied and which describes a change in​ supply? I. Farms are selling less chicken because the price of turkey has increased. II. Farms are selling less chicken because the price of chicken has fallen. III. Farms are selling more chicken because the price of chicken has risen. IV. Farms are selling more chicken because the cost of chicken feed has fallen.

I and IV are changes in supply and II and III are changes in the quantity supplied.

Which of the following statements is about a normal good​, which is about an inferior good​, which is about​ both, and which is about​ neither? I. With incomes falling in the​ recession, people are buying more chicken. II. People are buying more beef now that incomes have increased. III. People are buying more chicken because the price of chicken has fallen. IV. With higher incomes people are switching from chicken to beef.

I is​ inferior, II is​ normal, III is​ neither, and IV is both

The Fed threw a lot of money at the financial crisis in 2008 to unfreeze credit markets and encourage economic activity. As part of its effort to keep the interest rate​ low, the Fed purchased government bonds worth​ $300 billion between March and September 2009. By​ October, the Fed held​ $770 billion in government​ securities, nearly double its​ pre-crisis total. Before the​ crisis, the Fed held mainly government​ securities, which it used to control the quantity of money in the economy. Now government securities make up just​ 35% of the​ Fed's balance sheet.If government securities make up just 35 percent of the​ Fed's assets, calculate the​ Fed's total assets. What effect did the​ Fed's purchase of​ $300 billion of government bonds have on the​ Fed's total​ liabilities?

If government securities make up 35 percent of the​ Fed's assets, then the​ Fed's total assets are ​$2,200 billion. The​ Fed's purchase of​ $300 billion of government bonds increased its total liabilities by ​$300 billion.

Indicate all the items in the following list that are not consumption goods and services and explain why. Item a​: A hamburger Item b​: A beach Item c​: A tennis racquet Item d​: An interstate highway Item e​: A university Item f​: A stealth bomber

Items b​, d​, e​, and f because they are not items that individuals and governments buy and use up in the current period.

Lori is a student who teaches golf on the weekend and in a year earns ​$30 comma 000 after paying her taxes. At the beginning of 2015​, Lori owned ​$2 comma 500 worth of​ books, DVDs, and golf clubs and she had ​$3 comma 000 in a savings account at the bank. During 2015​, the interest on her savings account was ​$210 and she spent a total of ​$20 comma 000 on consumption goods and services. The market value of her​ books, DVDs, and golf clubs did not change. How much did Lori save in 2015​? What is her wealth at the end of 2015​?

In 2015, Lori saved $10,210 Lori's wealth at the end of 2015 is $15,710

M2 consists of​ _____ plus​ _____ and​ _____ deposits,​ _____, and other deposits.

M1; savings​ deposits; small​ time; money market funds

Which of the following statements illustrates structural unemployment​?

Outsourcing resulted in many job losses in the mid 2000s.

Which of the following statements illustrates frictional unemployment​?

Robin is quitting his current job to find another that has better prospects.

which of the following is an example of entrepreneurship?

Sam Walton created the multinational retail corporation brand Walmart in 1962

Stephen graduates from college and his income increases by $35,000. Nothing else changes. Stephen decreases the quantity of T-Shirts and chocolate chip cookies that he buys and increases the quantity of winter vacation that he buys. For Stephen, _______.

T-shirts and chocolate chip cookies are inferior goods

Which of the following statements illustrates fiscal policy​?

The US government has proposed a hike in the corporate tax rate.

Suppose that banks had deposits of $ 600 billion​, a desired reserve ratio of 5 percent​, no excess​ reserves, and $ 20 billion in currency. What is the amount of commercial bank deposits at the central bank​?

The amount of commercial bank deposits at the central bank is $10 billion.

The quantity of money grows at a rate of 15 percent a​ year, potential GDP grows at 3 percent a​ year, and the velocity of circulation is constant. Calculate the inflation rate in the long run.

The inflation rate in the long run is 12 percent a year.

The​ People's Bank of China lowered the required reserve ratio from 17.5 percent to 17​ percent, noting that it remained much higher than in other countries. If the currency drain ratio in China is 10 percent of deposits and the desired reserve ratio equals the required reserve​ ratio, calculate the money multiplier in China and compare it with the U.S. money multiplier. Assume that the required reserve ratio in the United States is 10​ percent, the required reserve ratio in China is 17​ percent, and the currency drain ratio in both countries is 10 percent of deposits.

The money multiplier in China is 4.1 The money multiplier in the United States is 5.5.

The BLS reported that in December​ 2015, the labor force was 157.8​ million, employment was 149.9​ million, and the​ working-age population was 252.0 million. The BLS also reported that 18.3 percent of all employment in December 2015 was part time and that 6.0 million people worked part time for economic reasons. How many people worked part time for noneconomic​ reasons?

The number of people who worked part time for noneconomic reasons is 21.4 million.

When the Fed sells securities in the open​ market, the monetary base​ _______ and the interest rate​ _______.

decreases; rises

Which of the following statements by Tom demonstrates that his buying plans obey the law of demand​?

The only thing​ that's changed is the price of​ textbooks: they've become more expensive and now​ I'm not buying as many.

In 2016​, the economy of Singapore was at full employment. In Singapore dollars comma S$ comma real GDP was400 billion. The nominal interest rate was 1.8 percent a​ year, the inflation rate was negative 1.6 percent a yearleft parenthesis deflation right parenthesis comma the price level was 1.02​, and the velocity of circulation was 0.76. Calculate the real interest rate. If the real interest rate remains unchanged when the inflation rate increases to 2 percent a year and then remains​ constant, how does the nominal interest rate change in the long​ run?

The real interest rate in 2016 is 3.4 percent a year. If the real interest rate remains unchanged when the inflation rate increases to 2 percent a​ year, the nominal interest rate increases to 5.4 percent a year.

The interest rate is 14% a year in Nigeria and 0.3% a year in Germany. The inflation rate is 9% a year in Nigeria and 0.1% a year in Germany. Calculate the real interest rate in Nigeria and Germany.

The real interest rate in Nigeria is 5 percent a year. The real interest rate in Germany is 0.2 percent a year.

Sally has a credit card balance of ​$2,000. The credit card company charges a nominal interest rate of 13% a year on unpaid balances. The inflation rate is 5% a year. Calculate the real interest rate that Sally pays the credit card company.

The real interest rate that Sally pays the credit card company is 8% a year.

The projected budget balance for Fiscal 2017 is a

deficit of $612 billion

Which of the following is the opportunity cost of attending a ball​ game?

The things you would have bought with what you spent on the ticket and bus fare getting to the game plus the things you would alternatively have done with your time.

In 2014​, U.S. exports of goods and services are ​$2,335 billion and imports of goods and services are ​$2,899 billion. What is the value of net​ exports?

The value of net exports in 2014 is -564 billion dollars.

A central bank is​ ______. The​ ______ is the central bank of the United States.

a public authority that provides banking services to banks and governments and regulates financial institutions and​ markets; Federal Reserve System

Fiscal policy is the use of the federal budget to​ _______.

achieve the macroeconomic objectives of high and sustained economic growth and full employment

The GDP price index is an average of the current prices of​ _____ included in the​ GDP, expressed as a percentage of base year prices.

all the goods and services

Cyclical unemployment is the fluctuating unemployment over the business cycle that increases during​ _____ and decreases during​ _____.

a​ recession; an expansion

Reserves consist of the currency in the​ _____ plus the balance on its​ _____ account at​ _____.

bank's vaults;​ reserve; a Federal Reserve Bank

Loanable funds are used to finance​ ______.

business​ investment, a government budget​ deficit, and international investment or lending

A market is an arrangement that brings​ _____ together and enables them to get information and do business with each other.

buyers and sellers

The two types of goods and services produced are​ _______. An example of​ _______.

consumption goods and services and capital​ goods; a consumption good is your​ iPad, and an example of a capital good is the pizza oven at a pizzeria

National debt is the amount of government​ _____ -​ _____ that has arisen from past​ _____.

debt​ outstanding; debt; budget deficits

A poor rice harvest will​ _____ rice and​ ____ its price.

decrease the supply of; raise

For consumers, hot dogs and burgers are substitutes. If the price of hot dogs decrease, then the demand for burgers will what?

decrease, and the demand curve for burgers will shift leftward

Depreciation is the​ _____ in the value of​ _____ that results from its use and from obsolescence.

decrease, capital

The Fed decreases the quantity of money. In the short​ run, the quantity of money demanded​ ______ and the nominal interest rate​ ______.

decrease; raises

A rise in the money wage rate when the economy is at potential GDP​ ______.

decreases aggregate supply because a rise in the money wage rate increases​ costs, so firms employ fewer workers

In the short​ run, when the price level in India increased​ India's aggregate supply​ ______.

didn't change, but the quantity of real GDP supplied increased

Sophie transfers ​$13​,000 from her small time deposit at the Bank of Arkansas to her savings account. M1​ _______ and M2​ _______.

does not change; does not change

Marla is an associate at JCPenney who wants to work 40 hours week but works 25 hours a week because sales at JC Penney are slow. Marla works part time for​ _______ reasons. Joe is a server at Olive Garden who wants to work 40 hours a week but works 15 hours a week because the number of patrons at Olive Garden has decreased. Joe works part time for​ _______ reasons.

economic; economic

A model of the economy that shows a circular flow of​ _____ that result from decision​ makers' choices and the way these choices interact to determine​ _____ goods and services are produced is the circular flow model.

expenditures and​ incomes; what,​ how, and for whom

The functional distribution of income shows the distribution of income among​ ______ and the personal distribution of income shows the distribution of income among​ ______.

factors of production; households

The interest rate on a financial asset​ ______.

falls as the price of the asset rises

After heavy rain and low​ production, the weather improves and coffee growers enjoy bumper crops. The price of coffee​ _______ .

falls because the supply of coffee increases and the demand for coffee remains unchanged

The demand for a good decreases by 10 percent and the supply of the good decreases by 8 percent. The price of the good​ _______ because​ _______.

falls; demand decreases by more than supply decreases and when demand decreases the price falls

In the long run with the given change in the quantity of​ money, the value of money​ ______ and the price level​ ______.

falls; rises

U.S. gross domestic product is the market value of all the​ ______ produced​ ______ in a given time period.

final goods and services; within the United States

Real GDP is the value of the​ _____ goods and services produced in a given year expressed in terms of the prices in​ _____ year.

final; a base

Nominal GDP is the value of the​ _____ goods and services produced in a given year expressed in terms of the prices of ​ _____ year.

final; the same

Gross domestic product ​(GDP​) is the market value of all the​ _____ goods and services produced​ _____ a country in a given time period.

final; within

Prior to the Great​ Depression, the purpose of the federal budget was to​ _______.

finance the activities of the federal government

the benefit of something is ____.

gain or pleasure it brings

Land is the _______ that we use to produce goods and services.

gifts of nature or natural resources

Read Eye on the Environment and describe a tradeoff faced when deciding how to generate electricity and whether to use wind power. A tradeoff faced when deciding how to generate electricity and whether to use wind power is​ ______.

giving up other goods and services to get clean electricity delivered over​ long, high-cost transmission lines

A circular flow model shows the interrelationship between the​ ____ markets and the​ ____ markets.

goods; factors

Examples of capital include all of the following except​ _______.

google stock

Which of the following are included in the expenditure approach to measuring​ GDP?

government expenditure on goods and services; consumption expenditure; investment

when a firm decides to use skilled professionals to produce its output, it is answering the question of?

how

In May​ 2011, businesses cut hiring because the higher price of gas pushed up costs and higher food prices forced consumers to cut spending. Did businesses and consumers act in their​ self-interest or the social​ interest? According to the news​ clip, businesses acted ​ _______ and consumers acted​ _______.

in their own​ self-interest; in their own​ self-interest

The Labor Department said that the economy added​ 146,000 jobs in​ November, and the unemployment rate fell to​ 7.7% from​ 7.9% in October. But it fell mainly because workers dropped out of the labor force. Explain how the new jobs change the labor force and the unemployment rate. New jobs​ ______ the labor force and​ _______ the unemployment rate.

increase or do not change; lower

A bumper wheat crop ​ ____ wheat and​ ____ its price.

increase the supply of; lowers

When people move out of bonds and into​ money, the demand for money​ _____ and the interest rate on bonds​ _____.

increase, rises

A decrease in wealth will​ ______ the supply of loanable funds and​ ______.

increase; and shift the supply of loanable funds curve rightward

In the short​ run, when Indian universities increased the number of engineering graduates ​India's aggregate supply​ ______.

increased

In the short​ run, when U.S. firms moved their IT and data functions to​ India, India's aggregate supply​ ______.

increased

The Commerce Department reported that retail sales increased 1.3 percent in June. Net exports were up 0.8 percent in the first quarter and inventories held by businesses rose by 0.3 percent in June. Total sales by businesses rose 0.3 percent. Explain the effect of the rise in net exports on GDP.

increases GDP

Mildred and Robert are the only buyers in the market for DVDs.Mildred buys 6 DVDs when the price of a DVD is $6.00, 3 DVDs when the price of a DVD is $8.00 and 2 DVDs a month when the price of a DVD is $10.00. Robert buys 14 DVDs a month when the price of a DVD is ​$6.00​, 6 DVDs when the price of a DVD is ​$8.00​, and zero DVDs when the price of a DVD is ​$10.00. In the market for​ DVDs, the quantity demanded​ _______.

increases as the price falls

Explain how aggregate demand changes when government expenditure on national defense increases by​ $100 billion. Aggregate demand​ ______.

increases by more than​ $100 billion because the government expenditure has a multiplier effect

An increase in real GDP​ ______ the demand for money and changes in financial technology​ ______.

increases; can increase the demand for money or decrease the demand for money

As the economy moves out of the recession and real GDP​ increases, the demand for money​ ______. To keep the interest rate​ constant, the Fed will​ ______ the quantity of money.

increases; increase

As the price level​ rises, firms respond in the short run to the change in the real wage rate by​ ______.

increasing production

M1 consists of currency held by​ _____ and​ _____, _____, and​ _____ owned by individuals and businesses.

individuals; businesses;​ traveler's checks; checkable deposits

The Fed uses its policy tools to​ _______.

influence the interest rate and regulate the amount of money circulating in the United States by adjusting the reserves of the banking system

The federal funds rate is the​ _____ rate on​ _____ loans.

interest; interbank

Human capital​ _____ that people obtain from​ education, on-the-job​ training, and work experience. ​_____ that have been produced in the past and that businesses now use to produce goods and services is capital.

is the knowledge and​ skill; ​Tools, instruments,​ machines, buildings, and other items

Calculate the approximate number of years it will take for real GDP per person to double if an economy maintains an economic growth rate of 12 percent a year and a population growth rate of 5 percent a year.

it will take 10 years for real GDP per person to double

A​ bank's liquid assets consist of​ ______.

it's short term Treasury bills and overnight loans to other banks

The unemployment rate is the percentage of the people in the​ _____ who are unemployed.

labor force

Potential GDP is the value of real GDP when all the​ economy's factors of production​ - _____,​ _____, _____, and​ _____ - are fully​ _____.

labor; capital;​ land; entrepreneurial​ ability; employed

The productive resources that are used to produce goods and services​ - _____ are factors of production.

land, labor,​ capital, and entrepreneurship

By increasing the required reserve​ ratio, the Fed forces banks to hold a​ _______ quantity of monetary base and the interest rate​ _______.

larger; rises

By lowering the interest​ rate, the Fed makes it​ _______ costly for the banks to borrow monetary base and the interest rate​ _______.

less; falls

Households are individuals or groups of people​ _____ together.

living

The largest asset of commercial banks are​ _______.

loans

Globalization has reduced African poverty.

macroeconomics

the government must cut its budget deficit

macroeconomics

Motor vehicle production in China is growing by 10 percent a year.

microeconomics

apple sells 20 million iPhone 6's a month

microeconomics

coffee price rockets

microeconomics

The incomes earned by the factors of production are​ _______.

money flows from firms through factor markets to households

Fiat money are objects that are​ _____ because the law decrees or orders them to be​ _____.

money; money

A fall in the real interest rate will bring a​ ______ the demand for loanable funds curve.

movement down along

The demand for money is the relationship between the quantity of money demanded and the​ _______ when all other influences on the amount of money that people wish to hold remain the same.

nominal interest rate

The supply of money is the relationship between the quantity of money supplied and the​ _____.

nominal interest rate

Michelle is a student who wants to work 20 hours a week at Cost Cutters so she can attend school. Cost Cutters schedules her for 20 hours a week. Michelle works part time for​ _______ reasons. Florence is​ semi-retired and wants to work 15 hours a week at Walgreens so she can spend time with her grandchildren. Walgreens schedules her for 15 hours a week. Florence works part time for​ _______ reasons.

non-economic; non-economic

Currency consists of​ _____.

notes​ (dollar bills) and coins

The labor force is the number of people employed plus the​ _____.

number unemployeed

Which of the following events in the market for smartphones illustrates the law of​ demand? 1. The price of a smartphone falls. 2. Producers announce that smartphone prices will fall next month. 3. The price of a call made from a smartphone falls. 4. The price of a call made from a​ land-line phone increases. 5.An increase in memory makes smartphones more popular.

only event #1

Which of the following events in the market for timber beams illustrates the law of​ supply? 1. The wage rate of sawmill workers rises. 2. The price of sawdust rises. 3. The price of a timber beam rises. 4. The price of a timber beam is expected to rise next year. 5. Environmentalists convince Congress to introduce a new law that reduces the amount of forest that can be cut for timber. 6. A new technology lowers the cost of producing timber beams.

only event #3

Wealth is the value of all the things that people​ _____.

own

A stock is a certificate of​ _____ and claim to the​ _____ that a firm makes.

ownership; profits

The ​working-age population is the total number of​ _____ aged​ _____ years and over who are not in​ jail, hospital, or some other form of institutional care or in the U.S. Armed Forces.

people; 16

The business cycle is a​ _____ but​ _____ up-and-down movement of total​ _____ and other measures of economic activity.

periodic; irregular; production

The tax revenues in the federal budget include​ _______.

personal income​ taxes, Social Security​ taxes, corporate income​ taxes, and indirect taxes

The CPI tells us the​ ______ in the reference base period. The CPI in the reference base period is by definition equal to​ ______.

price level in a given period expressed as a percentage of the price​ level; 100

Loanable funds come from ​ ______.

private​ saving, a government budget​ surplus, and international borrowing

An increase in expected​ profit, other things remaining the​ same, ______ the equilibrium real interest rate and​ ______ the equilibrium quantity of loanable funds.

raises; increases

The three ways in which the U.S. fiscal imbalance might be successfully addressed are​ _______.

raising income​ taxes, raising Social Security​ taxes, and cutting Social Security benefits

Aggregate supply is the relationship between the quantity of​ _____ supplied and the​ _____ when all other influences on production plans remain the same.

real GDP; price level

The flows of the services of the factors of production are​ _______.

real flows from households through factor markets to firms

When the nominal interest rate​ rises, the opportunity cost of holding money​ ______ and the quantity of money demanded​ ______.

rises; decreases

Economics is the​ _____ the choices that​ individuals, businesses,​ governments, and entire societies make as they​ _____, and the influences on those​ choices, and the arrangements that coordinate them.

social science that studies; cope with scarcities

A bond is a promise to pay​ _____ sums of money on​ _____ dates.

specified; specified

The three types of financial markets are​ ______.

stock​ markets, bond​ markets, and loans markets

The economy is at full employment when all unemployment is​ _______.

structural and frictional

The markets of wheat and rice influence each other because wheat and rice​ are______.

substitutes; so a higher price of rice will increase the demand for wheat

The institutions that make up the banking system are​ ______.

the Federal Reserve​, commercial banks​, money market funds​, and thrift institutions

In​ 2007, the killer virus arrived in​ Hawaii, where almost all the queen bees used in the United States are bred. Bees are used in a third of the food we eat. Explain how a decline in the bee population affects the U.S. PPF.

the U.S. PPF rotates inward

suppose the price of a call on a smartphone rises. Explain the effect of this event on the quantity of smartphones demanded and on the demand for smartphones.

the demand for smartphones decreases

Financial capital is​ _______.

the funds used to buy physical capital

The PCE price index is an average of the current prices of​ _____ included in the consumption expenditure component of​ GDP, expressed as a percentage of​ _____ year prices.

the goods and services; base

The opportunity cost of holding money is​ ______.

the interest rate forgone on an alternative asset

human capital is ______?

the knowledge and skill that people obtain from​ education, on-the-job​ training, and work experience

All of the following are examples of scarcity except​ _______.

the light provided by the sun

As an economy moves up along its aggregate supply​ curve, ______.

the money wage rate and the money prices of other resources remain constant

Firms are institutions that organize​ _____ of goods and services.

the production

An open market operation is​ ______.

the purchase or sale of government securities by the Federal Reserve System in the open market

Demand is​ _____, when all other influences on buying plans remain the same.

the relationship between the quantity demanded of a good and the price of the good

suppose new technology lowers the cost of producing beef. Explain the effect of this event on the quantity of beef supplied and on the supply of beef

the supply of beef increases

Potential GDP is the value of real GDP when​ _______.

the unemployment rate equals the natural unemployment rate

Labor is

the work time and work effort that people devote to produce goods and services

Capital consists of​ _______.

tools, instruments,​ machines, buildings, and other items that have been produced in the past and that businesses now use to produce goods and services

The outlays in the federal budget include​ _______.

transfer​ payments, expenditure on goods and​ services, and debt interest

The New York Times reports that cruise lines have been slashing prices and cruise sales are up. It says this surge of interest tells us that despite the uncertain economic​ climate, people clearly need more fun in their lives and view their vacations as a valuable and necessary part of it. In deciding whether to take a​ cruise, would you face a​ tradeoff? You​ _____ face a tradeoff because​ _____.

would; you forgo something else that you might do

______ is an example of U.S. consumption expenditure.

your purchase of a coffee from Starbucks

Japan​'s real GDP was 543 trillion yen in 2005 and 553 trillion yen in 2006. Japan​'s population growth rate in 2006 was 0.0 percent. Calculate Japan​'s economic growth rate and growth rate of real GDP per person in 2006.

​Japan's economic growth rate in 2006 was 1.8 percent. The growth rate of real GDP per person in Japan in 2006 was 1.8 percent.


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