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Economists generally agree that sufficiently high minimum wage laws:

cause unemployment

Expenditure on domestically produced final goods and services is:

equal to the GDP

GDP) According to the information presented in Table: Calculating GDP, what is GDP?

$24.400

In 2019, consumer spending was $15,000, investment spending was $4,000, and net exports were -$500. GDP in 2019 was $22,000, government purchases of goods and services were

$3.500

Growth rate of nominal

(This year GDP-Base year GDP)/base year gdp x 100

How to calculate price index

(cost of market basket in a given year)/ (cost of market basket in base year) x 100

In 1815 Mexico has a real help per capita that was — times that of japan

1.5

From 1996 to 2005, the average annual growth rate of total factor productivity in the United States was

1.6

In 2019, 10 million people did not have a job but were actively looking for employment, and 85 million people had either a full-time or a part-time job. The unemployment rate in 2019 was

10.5

(Table: Peanut Butter and Jelly Prices) Use Table: Peanut Butter and Jelly Prices. Suppose a market basket consists of 20 jars of peanut butter and 10 jars of jelly. If 2017 is the base year, what is the value of the price index in 2017?

100

In February of 2020, roughly —% of unemployed individuals had been unemployed for 27 weeks or more

19.2

The base period for the consumer price index is

1982; 1984

Suppose that real GDP per capita, growing at a constant rate, doubles over 35 years. What must the annual growth rate of real GDP per capita be for this to occur?

2%

In the United state, consumer spending accounts for approximately — of GDP

2/3

If Jarrod's income is $80,000, and the price level is 4, then Jarrod's real income is:

20,000

About —% of the world's population lives in countries whose population is poorer than the U.S. population was a century ago.

25

During the Great Depression, the U.S. unemployment rate was as high as

25%

(Table: Real and Nominal Output) Use Table: Real and Nominal Output. In which year is all of the increase in nominal output due to an increase in real output?

3

If the nominal interest rate is 4%, and the inflation rate is 1%, then the real interest rate is

3

Table: Per Capita GDP) Use Table: Per Capita GDP. If 2016 is the base year, real GDP in 2016 was:

3,000

1980, US real per capita GDP was % of the U.S. real per capita GDP in 2016.

56

In 1980, US real GDP per capita was — of the US real GPD per capita of 2016

56

If the labor force participation rate is 70% the unemployment rate is

7.6

The Republic of Livonia has an adult population of 100 million; 60% of Livonia's population is employed, and 10% of the people are unemployed. The labor force participation rate in Livonia is

70%

Figure: The Labor Market. What will be the level of employment if firms decide to pay an efficiency wage of $16?

80,000

With inflation

A) overall prices are increasing, although some prices may be increasing and some may be decreasing.

natural rate of unemployment formula

Actual-cyclical

In circle flow diagram, firms

Buy resources

Increase in capital stock would

Cause a movement to the right along the stationary production function

Spending on inputs is _____ of GDP, and investment spending is _____ of GDP.

not a part; part

A decrease in the overall level of prices is:

Deflation

Real GDP tends to understate economic well-being because it:

Excludes the value of leisure

The movement from point B to point C is called a(n):

Expansion

When an economy is expanding, unemployment tends to — and overall prices tend to—

Fall, rise

Which change would accelerate a nation's long-run economic growth?

Faster technological progress

How to Calculate GDP

GDP = C + I + G + X - IM

A jobless recovery occurs when GDP is—and unemployment is —

Growing at a below average rate; rising

Which item CANNOT properly be called infrastructure?

Human capital

If the circular-flow model is in equilibrium and there is a decrease in government spending, which is likely the outcome

Increase in unemployment

Which is MOST likely to be a macroeconomic, and not a microeconomic, question?

Is the national unemployment rate rising or falling?

An example of human capital is a person's:

Job skills

The General Theory of Employment, Interest, and Money, written by— and published in—- , transformed the way economists thought about macroeconomics

John Maynard Keynes; 1936

A bank makes a loan for one year. The nominal annual interest rate is 7.5%. The real interest rate is 4%. Over the course of the year, overall prices increase by 4%. This rate of inflation will hurt the— because the actual rate of inflation is— than the anticipation rate of inflation

Lender; higher

Among the determinants of a country's standard of living, over:

Long periods, long run growth is much more important that the business cycle

Does a country with a trade deficit necessarily have a serious problem?

No. Trade deficits can occur when a country's investment spending is higher than its level of saving.

In India, the standard of living in 1980 was — than in 1947.

Not much higher

Figure: The Minimum Wage. What is the quantity of labor demanded at the binding minimum wage of P 3 ?

Q1

Menu costs

Real costs of changing listed prices

In a business cycle, a peak is immediately followed by a(n):

Recession

Efficiency wages are

Set above the equilibrium wage to incentive better performance

Shanice, who is 55 years old and has been a steelworker for 30 years, is unemployed because the steel plant in his town has closed and moved to a new location. Shanice is

Structurally unemployed

Circlular-flow diagram illustrates

The key concepts in the national accounts

If goods are sold in 2020 but produced in 2018

They are included in investment in 2018

Unemployment rate tends to

Vary between age groups and ethnicities

Use Figure: Circular-Flow Model. If the circular-flow model is in equilibrium (the sum of money flowing into each box is equal to the sum of the money flowing out of it), and there is an increase in exports, holding everything else constant, which outcome is likely to occur?

a decrease in the unemployment rate

Diminishing returns to physical capital suggest that:

at some point, increasing the amount of physical capital per worker is not worth the cost of the additional capital.

The price measure MOST widely used to determine the inflation rate in the United States is the

consumer price index

An economy's gross domestic product consists of:

consumption, investment spending, government purchases of goods and services, and net exports.

The idea that relatively poor nations should have higher rates of growth of real GDP per capita than relatively wealthy nations is known as the:

convergence hypothesis

If workers' nominal wages have risen by 30% over 10 years, and prices have increased by 40% in the same period, then we can safely conclude that the goods and services workers can buy have:

decreased quantity

When the inflation rate falls from 10% to 5%, the economy is undergoing

disinflation

As a limitation on economic growth, environmental- problems are more difficult to address than resource shortages because:

environmental problems don't automatically provide incentives for changed behavior.

In the circular-flow diagram, resources such as capital and labor are bought and sold in:

factor markets

The sum of the value added at all stages of the production of a good is the:

final value of the good.

Among the tools available to macroeconomic policy makers is:

fiscal policy, to influence overall spending.

Unemployment that occurs because it takes workers and employees time to find each other is

frictional unemployment

In 1820, Mexico had a higher real GDP per capita than did Japan. Yet now Japan is one of the richest countries in the world, and Mexico is poor. Japan's high rate of economic growth likely CANNOT be explained by:

heavy government intervention in markets.

Economies with high growth rates tend to be those that increase their:

human capital

If an economy is open:

it trades goods and services with other countries.

The promotion of employment and growth in the economy as a whole is a focus of a

macroeconomics.

One role of govermment policy, suggested by macroeconomic analysis, is to:

manage short-run economic fluctuations.

Between 1980 and 2020, which of the following grew fastest?

medical care prices

increase in the amount of physical capital per worker _ while technological progress—

moves the economy along the aggregate production function: shifts up the aggregate production function

real interest rate formula

nominal interest rate - inflation rate

Real wage formula

nominal wage/price level

Unemployment rate formula

number of unemployed/labor force x 100

Rule of 70 formula

number of years to double = 70/growth rate

The formula for the rule of 70, where n is number of years a variable takes to double, and r is growth rate, is expressed as:

n×r=70

When the price level increases and incomes remain constant,

real income decreases

In the circular-flow diagram, households:

supply resources.

Shoe-leather costs are the costs of:

the increased number of transactions when inflation is high.

Labor force

the total number of workers, including both the employed and the unemployed

An increase in the nation's —— is generally accepted as a long-run indicator of a rising standard of living.

• output per person