Macro test 2

What is real GDP in 2014 dollars if nominal GDP in 2014 is $15,000 billion, the GDP deflator in 2014 is 110, and the GDP deflator in 2010 was 100?

$13,636 billion

Company DEF produces gizmos. One particular batch cost $50,000 to produce. Because market conditions were bad at the time of sale, they were sold at a loss for $40,000. The value of the gizmos included in the GDP is:

$40,000

The economy is probably heading into a recession when the National Activity Index equals:

-0.94

Rocky Gap Furniture hires ten employees working eight hours each to produce 100 rocking chairs. What is the productivity of these workers?

1.25 chairs per hour

If output equals A × (5K + 2L), what is output if A equals 2,000, capital equals 10, and labor equals 100?

500,000

Last year, the consumer price index (CPI) was 115 while the consumer price index for this year is 125. The rate of inflation is:

8.7%

The recent global financial instability:

All of the answers are correct

Jennifer received news that she is getting a 5% raise. However, the Bureau of Labor Statistics just reported that prices are rising by 7%. Based on the given information, which of the following is true?

Jennifer is losing purchasing power by 2%

Which of the following resources is an example of infrastructure?

an elementary school

Alternating periods of macroeconomic expansion and contraction are known as:

business cycles

The largest component of GDP is:

consumption expenditure

When the economy is operating at the natural rate of unemployment:

cyclical unemployment is zero

When the government enforces contracts between two parties, it is acting in its role to promote economic growth by:

ensuring a stable legal system

In a simple circular flow diagram, total spending on goods and services in the product market:

equals the total income earned in the resource market

Jennifer did not work during college. She just obtained a bachelor's degree in marketing, and she is now looking for a marketing job in the retail industry. Jennifer is considered:

frictionally unemployed

Investment in human capital is important because:

it increases labor productivity

One important reason economists track business investment is that:

it is a leading indicator of the business cycle

In the absence of copyright and patent laws:

it is difficult for innovators to profit from their efforts

Jordan Meadows lost his job as an airline pilot and has not been able to find another job as a pilot. Since he is old enough to be eligible for his pension, he decides to retire and devote himself to caring for his elderly parents. According to the Bureau of Labor Statistics, Jordan is:

not in the labor force

Economic growth is most commonly measured by:

real GDP per capita

Which of the following is NOT an investment in human capital?

researching automated production techniques

Which of the following two things can people do with money received as disposable personal income?

spend money or put it into savings

During the 1970s, when handheld calculators became popular and replaced slide rules in performing computations, workers in the slide rule industry lost their jobs. These workers' unemployment status is:

structural

Which of the following occurrences is the key explanation for the high economic growth in the United States in the past century?

technology improvements

(Table) Suppose the Bureau of Labor Statistics collects the data presented in the following table: Year Cost of Basket 2010 $200 2011 $230 2012 $250 If 2010 is the base year, then the consumer price index for 2012 is:

125

If the growth rate in an economy is 2%, its GDP will double in about:

35 years