macro chapter review test

Réussis tes devoirs et examens dès maintenant avec Quizwiz!

the money price of a pack of microwave popcorn is $.44, the relative price of a pack of microwave popcorn in terms of burritos is 1.25 packs of burritos per pack if popcorn. The money price of a pack of burritos is

$.35

aggregate income in an economy in 2014 is $460. Savings is 30 and imports are 35 aggregate expenditure in the economy in 2014 is

$460

when the fed buys securities from a bank, a sequence of events begins

1. banks have excess reserves 2. banks lend excess reserves 3. the quantity of money increases 4. new money is used to make payments 5. some of the new money remains on deposit 6. some of the new money is currency drain 7. desired reserves increase because deposits have increased 8. excess reserves decrease

correct statements

1. we measure the marginal benefit from a good or service by the most that people are willing to pay for an additional unit of it. 2. to describe preferences, economists use the concept of marginal benefit.

If the quantity of money increases by 2 percent a​ year, in the long run the change in the price level is ____percent a year.

2

which are positive and normative?

3 and 4 are positive, 1 and 2 are normative

what is true about the neoclassical growth theory

3. The rate of technology change influenced the economic growth rate but economic growth does not influence the pace of technological change 4. as income increases Bothe the birth and death rate decrease

valued at the market exchange rate, GDP per person in the US in 2013 is_______ times that in china., valued at purchasing power parity prices, real gap per person in the US in 2013 is _____ times that of china

7.9; 5.4

ann's marginal cost of producing an additional unit of cookies is

8 units of bread

______ has a comparative advantage in milkshakes and _____ has an absolute advantage in both goods

Belinda, Elizabeth

when production is efficient

Mario can produce more pasta only by producing less pizza

choose the incorrect statement

a bias in the CPI gives workers with wage contracts linked to the CPI lass real income than the firms intended

when real GDP decreases,

a decrease in the demand for money occurs

choose the incorrect statement

a government budget surplus competes with investment for funds

all of the following are examples of investment except

a person depositing $100 a week to her savings account

choose what is incorrect

a rational choice will turn out to be the best choice after the event

resource use if efficient when

a situation cannot be improved upon

in the market for bread, the supply of bread will increase if any of the following occur except

an increase in the price of a loaf of bread

If OPEC is​ correct, the price change could have occurred as a result of demand changing because of​ ______ in the expected price of oil and supply changing because of​ ______ in the expected price of oil.

an increase; an increase

biscotti bought by delta airlines and served to passengers is an example of _____ good. second hand blue jeans is an example of _____ goods

an intermediate; nighter a final nor intermediate

The reference base period for the CPI is​ 1982-1984. In AprilApril ​2014, the CPI was 237.1 This number tells us that the​ ______ of the prices paid by urban consumers for a fixed basket of consumer goods and services was​ ______ .

average; 137.1 percent higher in April 2011 than the average of 1982-1984

suppose that the us and Cuba decide to open up trade. if each country specializes in the good in which it has a comparative advantage, _________ will gain from that trade because...

both countries; consumption possibilities in both Cuba and the US will lie outside their PPFs

Microsofts marginal cost of the 100th copy of Microsoft window 8 is

calculated as the slope of PPF at the point where the 100th copy of windows 8 is produced

as a result of financial innovation, _____ have become ________.

checking deposits at thrift institutions; an increasing percentage of M1

choose the incorrect statement

coins, which are issued by the treasury are an asset of the Fed and a component of the monetary base

choose the correct statement

commercial banks are financial institutions that accept deposits, provide payment services, and make loans to firms and households

if as the price of beef increases, the quantity of leather that firms plan to sell increases, then beef and leather are

complements in production

low fat milk and cream are

complements in production fro a dairy

the news clip illustrates a change in the supply of flights when it reports that American Airlines is

cutting the number of flights with no mention of the change in airfare

a government budget deficit occurs, which _____. the real interest rate______.

decreases the supply of loanable funds; falls

which of the following are included in the income approach to calculating GDP?

depreciation; compensation of employees; indirect taxes less subsidies (other factor incomes maybe)

the ratio of reserves to deposits that a bank plans to hold is its _____. if a bank had $10 million actual reserves and $8 million in desired reserves, then it has______.

desired reserve ration; excess reserves

liquid assets

do NOT have a higher interest rate than securities

an economy that uses new technology

does not eliminate scarcity

if the growth rates of 2009 are maintained in future years, real gap per person in eastiana will

double by 2019

if the growth rates of 2012 are maintained in future years, real gap per person in Atlantis will

double by 2046

Choose the correct statements

economists use natural experiments, statistical investigations, and economic experiments. an economic model is a description of some aspect of the economic world that includes only those features that are needed for the purpose at hand

the supply of loanable funds is influenced by all of the following except

expected profit

real flows are the flow of

factor production from households to firms and the flow of goods and services from firms to households

a decrease in the demand fro rice brings a ______ in the price of rice and ______ in the quantity of rice supplied

fall; a decrease

the liabilities of the fed are_______, and these liabilities along with ______ make up the monetary base

federal reserve notes held by households and business and reserves of depository institutions; coins issued by the treasury

whether for motor company gets a larger profit or its workers get higher wages is a ________ question

for whom

the law of supply states that other things remaining the same, the higher the price of a good, the ______; and the lower the price, the _____

greater is the quantity supplied; smaller is the quantity supplied

the opportunity of producing a cake is ____ at point a than at point B the opportunity cost of producing a loaf of bread is ____ at point b than at point a

greater; greater

potential gap per person

grows at a steady pace but nat a constant pace

if tom also has an absolute advantage in growing blueberries and cherries, he will

have a comparative advantage in one activity but not both

choose the incorrect statement

in 2012 about 700 commercial banks operated in the US

suppose the fed buys $50 million of government securities from the bank of America. The fed's Toal assets ______ and its total liabilities_______. The bank of americas total assets ______ and its total liabilities ________

increase by 50 million; increase by 50 million do not change; do not change

a decrease in the voice of leather jackets, complement in production of beef, will______ the equilibrium price of beef and ______ the equilibrium quantity of beef

increase; decrease

The price of oil hit a record high above​ $135 a barrel in May 2008 long dash— more than twice what it cost the year before ... OPEC has so far blamed price rises on speculators and says there is no shortage of oil. The price of oil rises if the demand for oil_____ and the supply of oil _____ a shortage in the market for oil implies that

increases: decreases the price of oil is being prevented from influencing buying and selling plans

an increase in the population ____ potential gap and ____ potential gap per hour of labor

increases; decreases

an increase in real GDP _______ the demand for money ad financial innovation__________.

increases; might increase the demand for some types of deposits and decrease the demand for others

the bias in the CPI is a problem because

it distorts wage agreements linked to the CPI

the income earned by the people who sell the services of the factor of production__________ is called __________

land; rent

Stephen's opportunity cost of producing a ton of apples is ______ than Jack's, so jack _______ gain from specialization and trade with Stephen

lower than; can

an economy produced snowboards. If more than the efficient quantity of snowboards is produced

marginal cost exceeds marginal benefit

the inflation rate in 2014

might be higher, lower. or the same as in 2013

luxury car makers announce a fall in next years price of a luxury car and an increase in the ease in which credit can be obtained. You predict that the demand fro luxury cars today

might increase, decrease or remain the same

choose the incorrect statement

most economists believe that the Ricardo-barro effect holds in the loanable funds market

if the price of a taco rises, a _____ the demand curve occurs. if any factor that influences buying plans other than the price changes, then a ______ the demand curve occurs

movement up along; shift of

if the price of a taco rises, a _______ the supply curve occurs. If any factor that influences selling plans other than the price changes, then a ________ the supply curve occurs

movement up along; shift of

between 1960 and 2010, the gap between real gap per person in the US and Japan

narrowed

if we count marginally attached workers as unemployed

no change occurs in the employment to population ratio

choose the correct statement

nominal GDP is just a more precise name for GDP

assume that the preconditions fro labor productivity growth are in place. the pace of labor productivity growth is influenced by all of the following except

population growth

when the real interest rate falls, the _____ because the _____ is the opportunity coast of loanable funds

quantity of loanable funds demanded increases; real interest rate

convergence between real gap per person in the us and Japan was relatively _____ during the 1960s; convergence has recently been _____

rapid; decreasing

choose what is incorrect

real gap per person grows at a constant rate

the amount paid each month by an oil company for the right to drill on a farmer's land is called

rent

the marginal cost curve is upward sloping because

resources are not all equally productive in all activities

on average in the us, the inflation rate and the money growth rate minus the real gap growth rate

rise and fall together

when the interest rate rises, other things remaining the same, the opportunity cost of holding money _____ and _______

rises; the quantity of money demanded decreases

a _____ is a depository institution that accepts saving deposits and makes mostly home-purchase loans. a ______ is a depository institution owned by a social or economic group such as a firms employee that accepts savings deposits and makes mostly personal loans

savings bank; credit union

if the interest rate is 5 percent, people will _____ bonds. Bond prices will ______

sell, fall

an increase in labor productivity

shifts the demand for labor curve rightward and the production function upward

in increase in the population

shifts the supply of labor curve rightward and creates a movement along the production function

French fries and baked potatoes are

substitutes or substitutes in production

how can the change in us wealth differ from us saving

the change in wealth includes changes in the price of assets owned and saving exclude these items

taking an MP3 player to the gym becomes less popular. As a result

the demand for MP3s decreases

choose the incorrect answer

the demand for labor is the relationship between the quantity of labor demanded and the money wage rate

choose the statement about growth in labor productivity that is incorrect

the demand fro labor increases, the production function does not change, but a movement occurs along the production function

the demand of US dollars changes when there is a change in any of the following except

the foreign exchange rate

the fundamental precondition fro labor productivity growth is

the incentive system created by firms, markets, property rights, and money

when the price of an asset rises,...

the interest rate falls

when GDP per person in china in 2013 is valued at ______, gap per person in the us is ______ times that in china

the market exchange rate; 7.9

which of the following topics is studied in macro?

the national economy and the global economy

goods and services are

the objects that people value and produce to satisfy human wants

Consider the following statements about factors that influence the standard of​ living, and choose the statement that is incorrect.

the omission of household productions from God means that the growth rate of gap underestimates the growth rate of total production

along the supply curve,

the price changes but all other influences in producer's planned sales remains the same

choose the statement about an increase in the population that is incorrect

the production function shifts upward

choose the option that is an example go government expenditure

the purchase of office supplies for the office of the junior senator from New York

correct statement

the quality of labor depends on human capital

if the price of a yoga class falls, all other influenced on buying plans remaining the same, in the market for yoga classes

the quantity of yoga classes demanded increases

a relative price is

the ratio of one money price to another

which is incorrect

the return to full employment in an expansion phase of the business cycle is economic growth

the CPI places more weight on _______ than on______

transportation; medical care

choose the correct answer

we measure the change in production by comparing the value of real gap in two different years

an MP3 player is a normal good. If income is expected to increase next year, you predict that the demand for MP3 players _________ now

will increase

when you make economic choices that result in what, how, and for whom goods and services are produced

you are making choices that are in your self interest and the people who produce and deliver the goods and services that you decide to buy are also making choices in their self interest

______ is an example of US consumption expenditure

your purchase is a flight on American Airlines


Ensembles d'études connexes

Chapter 12 - T/F & Multiple Choice

View Set

systems analysis and design chp 12

View Set

Real Estate U Texas Principles of Real Estate - Part 2

View Set

Chapter 13: Obesity, Energy Balance, and Weight Management

View Set

The Vertebrates and The Invertebrates, Genetic of Bacteria and Viruses

View Set