MacroEconomics Exam #2
John expects to get a raise equal to the increase in consumer price index. The CPI has gone from 160 to 164. If John's salary last year was $50,000, what salary does he expect to earn this year?
$51,250
Which of these is a non durable good?
(anything that won't last)
Physical capital includes
manufactured products that are used to produce other goods and services
Generally, countries with the ____ economic freedom also have the ____ per capita GDP
most; highest
Increases in ______ often lead to economic growth
technology
The capital to labor ratio measures
the amount of economic capital per worker.
Workers who want to work but have bene frustrated by the inability to find work and have stopped searching are known as
Discouraged workers.
The labor force is defined as the
Total number of employed and unemployed
_______ is a measure of the change in the average prices paid by urban consumers for a typical market basket of goods and services
the consumer price index
a production function shows the
the output that is produced using different combinations of inputs combined with existing technology
Nominal GDP in 2006 was 13,458.2 billion. In 2006, the GDP deflator was 116.9. What was the real GDP for 2006 if the GDP deflator uses 2000 as the base year?
11,512.6 billion
If the growth rate in an economy is 3.5%, then its GDP will double in about
20 years.
Last year, the consumer price index was 115 while the consumer price index for this year is 125. The rate of inflation is?
8.7%
Gross Domestic Product is a measure of
An economy's total output
Which of these is an example of gross private domestic investment
Change in business inventories
When the economy is operating at full employment _____ unemployment is zero
Cyclical
Jennifer did not work during college. She just obtained a bachelor's degree in marketing, and is now looking for a marketing job in the retail industry. Jennifer is considered
Frictionally Unemployed
Which group benefits from an unanticipated rise in inflation rate?
Homeowners with a fixed rate mortgage
The natural rate of unemployment
Is associated with the economy's maximum output rate consistent with low inflation.
Total spending in an economy is the sum of?
Personal consumption + Gross private investment +Government spending + net exports
Economic growth is most commonly measured by
Real GDP per capita
Janet is receiving a 5% raise. If the rate of inflation is 2%, then Janet's purchasing power is
Rising
Robert lost his job and now takes care of his children while his wife works. He would take a job similar to the one he lost if were offered, but he is not actively seeking work. How is robert categorized in the unemployment figures?
Robert is not part of the labor force.
GDP can be found by adding up either all of the _____ or all of the _____ in the economy.
Spending;Income
If a product becomes obsolete and the workers who produced that product will need additional training to find new jobs, they are experiencing _______ unemployment
Structural
What event was a major influence on the development of macroeconomics?
The Great Depression
Infrastucture
a country's public capital
If the cost of a typical market basket in 2019 is 400 and the cost of a typical market basket in 2020 is 390, then during this period the economy is undergoing
deflation
____ is a reduction in the rate of inflation
disinflation
In the United States, people are considered unemployed if and when they
do not have a job but are available for work and have been actively seeking work.
The three types of consumption are
durables, nondurables, and services.
Frictional unemployment occurs when job openings
exist, and people are willing to take them, but it takes some time to bring the two together.
Improvements in technology
explain most of the economic growth in recent decades
Gross domestic product is the total market value of all
final goods and services produced in the United States by labor and property.
as a general rule. the more capital employed with workers. the ____ their productivity and the ____their earnings
higher; higher
According to the production function, which will not result in economic growth
increases in consumption spending
To have long term economic growth, the production function suggests
increasing the availability of technology, capital and labor
if technology is held constant, an increase in capital concurrent with a decrease in labor input causes output to
rise, fall or stay the same.
Zach has been laid off from his job as an aircraft worker. He has been actively looking for a job but has had no luck for the past 6 weeks. According the bureau of labor statistics, Zach is
unemployed
What is real GDP in 2010 dollars if nominal GDP is 2014 is $15,000 billion; the GDP deflator in 2014 is 110; and the GDP deflator in 2010 was 100?
$13,636 billion
US steelworkers who have lost their jobs to workers receiving lower wages overseas are part of ____ unemployment
Structural
The principal measure of inflation in the United States is
The consumer price index
If a country's population increases at a higher rate than the growth rate of its real GDP
The standard of living in that country has decreased
Human capital includes
the improvements to labor capabilities from training, education, and apprenticeship programs.
