ECO Macroeconomics EXAM 1 SCORED 97.5/100
Use the following table to answer the next question. YearReal GDPPopulation2008$20,000200200940,000400201060,000400201170,000500 In 2009, real GDP per capita equals _____.
$100
Use the following table to answer the question below. Price per UnitQuantity Demanded per YearQuantity Supplied per Year$52,0000101,800300151,600600201,400900251,2001,200301,0001,500 In this competitive market, the price and quantity will settle at
$25 and 1200 units
Use the following table to answer the next question. YearNominal Income (dollars)CPIReal Income (dollars)1$44,600130 2$48,200 $35,1833$51,000139 What is the value of real income in Year 1?
$34,308
Use the following graph for a competitive market for a product where the government has set a price floor of 0C to answer the question below. What quantity will the sellers be able to sell after the imposition of the price floor?
0E
se the table below to answer the next question. YearEmployedStructuralFrictionalCyclicalUnemployed20031,800501005020020042,400100100 30020052,000 15018050020062,66040 0140 Determine the number of people cyclically unemployed for the year 2004.
100
Answer the question below based on the following price and output data over a five-year period for an economy that produces only one good. Assume that year 2 is the base year. YearUnits of OutputPrice per Unit18$22103315441855206 If year 2 is the base year, the Consumer Price Index for year 1 is
67
If the total population is 200 million, the labor force is 100 million, and 92 million workers are employed, then the unemployment rate would be
8%
Use the following table to answer the question below. (1)(2)(3)(4)(5)QdQdPriceQsQs5040$1070806050960708060850609070740501008063040 Suppose that market demand is represented by two demanders in columns (1) and (2) and market supply is represented by two suppliers in columns (4) and (5). If the price were artificially set at $9
A surplus of 20 units would occur
A market for a product reaches equilibrium when
Buyers intend to buy a quantity equal to the quantity that sellers intend to sell
In the expansion phase of a business cycle
Employment and output increase
T/F: Positive economic statements indicate what should be done in a situation, whereas normative statements indicate a level of indecision.
False
In year 1, the Consumer Price Index was 120 and the average nominal income was $30,000. In year 2, the Consumer Price Index was 125 and the average nominal level of income was $32,000. What happened to real income from year 1 to year 2?
It rose by $600
When Adam Smith described the 'invisible hand' as the regulating and motivating force in capitalism, he was referring to
Mercantilism
Use the following graph for a competitive market to answer the question below. A price floor of $10 per unit will result in a
No shortage or surplus
GDP measured using current prices is called _____.
Nominal GDP
What do government purchases include in national income accounting?
Purchases by federal, state, and local governments
Which of the following would most likely move the economy into a recession in the short term?
The central bank printing less money than was expected.
Which of the following scenarios would be considered an investment according to economists?
The owner of a fishing company buys new fishing gear.
When inflation occurs
The purchasing power of money decreases
Adding up the market value of all final and intermediate goods and services in an economy in a given year would result in _____.
an amount greater than GDP for that year
In calculating the unemployment rate, "discouraged" workers who are not actively seeking employment are
excluded from the labor force.
GDP tends to overstate economic well-being because it takes into account _____.
expenditures undertaken to correct pollution
Real income will rise from one year to the next if nominal income
falls and the price level falls faster.
Suppose that in each of four successive years producers sell more of their product and at lower prices. This could be explained
in terms of a stable demand curve and increasing supply.
If a person's nominal income increases by 5% while the price level increases by 2%, then that person's real income
increases by 3%
The best example of a "frictionally unemployed" worker is one who
is in the process of voluntarily switching jobs.
Computation of GDP by the expenditures method would include the purchase of _____.
land by the U.S. Department of Interior
The presence of discouraged workers
may cause the official unemployment rate to understate the true amount of unemployment.
"Full employment" refers to the situation when there is
no cyclical unemployment.
In calculating GDP, governmental transfer payments, such as Social Security or unemployment compensation, are _____.
not counted.
An example of an intermediate good would be _____.
paper and ink bought by a publishing company
Which of the following measures is most often used to compare the standards of living in different countries?
per capita income
A GDP price index of 130 in year 2 means that _____.
prices in year 2 are on average 30% higher than in the base year
There is an excess demand in a market for a product when
quantity demanded is greater than quantity supplied.
Picture a competitive market with the usual upward sloping supply curve and downward sloping demand curve. If the current price is creating a shortage, then market forces will cause the price to adjust and
quantity supplied will increase
In Year 1, nominal GDP was $848 billion. The next year, Year 2, it grew to $912 billion. During that same time, the GDP deflator grow from 146 to 158. As a result, we can conclude that
real GDP fell by about 2 1/2 billion dollars and all the growth in nominal GDP came from inflation.
se the following graph for a competitive market to answer the question below. A price floor of $25 per unit will result in a
surplus of 200 units.
se the following diagram for the corn market to answer the question below. If the price in this market is $4 per bushel, there will be a
surplus, and the price will tend to fall.
There is a shortage in a market for a product when
the current price is lower than the equilibrium price.