Quiz 3 answers

Human capital

is knowledge and skills that workers have acquired.

Productivity

Is the amount of goods and services produced each hour of workers' time. Linked to economic policies

Greg learns how to bake from his grandma, this is an example of

Human capital, but not technological knowledge

There are large differences in the standard of living..

...across countries and within countries over time.

CPI is used to...

...monitor changes in the cost of living

CPI is a measure of...

...the overall cost of goods and services bought by a typical consumer, and the CPI is computed by the Bureau of Labor.

CPI calculations

100 (CPI of current year/ CPI base year)

Finding the real cost

Amount ($) in year T x (price level today/ price level T) ex. lower sum of money or earlier year, times CPI of current day divided by CPI of other year

What is higher in Mali than in the United Kingdom?

Child mortality

Natural resources

The inputs into production of goods and services that are provided by nature, such as land, rivers, and mineral deposits.

When computing the cost of the basket of goods and services purchased by a typical consumer, which of the following changes from year to year?

The prices of the goods and services

Country with the lowest growth rate

United Kingdom

Inflation rate

[(CPI from current year - CPI from previous year)/CPI from previous year] x 100

Economist terminology of Inflation

economists use the term inflation to describe a situation in which the economy's overall price level is rising.

Real interest rate

real interest rate = nominal interest rate - inflation rate