Quiz 2 Macro Economics

A public good is a good that:

when consumed by one individual, can still be consumed by others.

The Consumer Price Index in its base year is what?

always equal to 100

Refer to the table below. In Tuvalu, what is the opportunity cost of producing one coconut (in terms of mangoes)? Tuvalu Mangos- 1200 Coconuts- 3600

1/3

If the labor force is 150 million and the numbers of people who are looking for jobs but are unable find them is 15 million, what is the unemployment rate?

10 percent

In Kiribati, what is the opportunity cost of producing one mango (in terms of coconuts)? Kiribati Mangos- 300 Cocunuts- 1200

4

In the early 2000s, U.S. clothing retailers sued the U.S. government to stop imposing limits on Chinese textile imports. Such limits are an example of what?

A quota

Which of the following would most likely generate a negative externality?

Cigarette smoke

What would most likely generate a positive externality?

Education

What is an advantage of a corporation over a sole proprietorship?

Greater ability to obtain funds

An import quota does which of the following?

Increases the price of the domestic good to the consumer.

What is true for a sole proprietorship?

It has only one owner who has unlimited liability

Refer to the table below. What country holds a comparative advantage in the production of coconuts? Kiritabi Mangos- 300 Coconuts- 1,200 Tuvalu Mangos- 1,200 Coconuts- 3,600

Kiritabi

Which is the best example of a public good?

National Defense

State and local governments do not receive income directly from which source?

Social Security Taxes

In the early 2000s the U.S. government imposed import duties on Chinese frozen and canned shrimp. These duties are an example of what?

Tariffs

Refer to the table below. What country holds a comparative advantage in the production of mangoes? Kiritabi Mangos- 300 Coconuts- 1,200 Tuvalu Mangos- 1,200 Coconuts- 3,600

Tuvalu

What is the top of the business cycle is called?

a peak

What type of unemployment is caused by recession?

cyclical unemployment

One advantage of a sole proprietorship over a partnership is:

direct control by the owner.

According to economist, a free rider is someone who what?

does not pay for their own consumption of a public good

An increase in nominal GDP implies an increase in what?

either the price level or output or both.

What are net exports?

exports minus imports

If nominal GDP rises, what happens to the well-being of society?

it may have increased or decreased

If prices rose by 5% and nominal output rose by 8%, what happened to real output?

it rose by 3%

Suppose that both your nominal wage and prices double. What will happen to the real purchasing power of your wage?

it will remain the same

What causes structural unemployment?

people losing a job when their skills become obsolete due to technological innovations