Econ 201 exam 2

अब Quizwiz के साथ अपने होमवर्क और परीक्षाओं को एस करें!

Suppose the CPI last year is 121 and the CPI this year is 137. The correct method to calculate the inflation rate is

(137 - 121)*100=113.2

Labor force participation rate =

(labor force)/(working age population)*100

The real wage rate equals

(money wage rate)/(price level)

Calculate the percent change in nominal income

(old - new)/(old) *100

Which of the following means that the CPI overstates the actual inflation rate

1.) Outlet substitution bias 2.) New Good Bias 3.) Quality change bias 4.)All of the above!!!!!!!!!!!!!!!!*****$$$$$$

T/F Misery index = inflation rate - unemployment rate

False

T/F unlike cyclical unemployment, both frictional and structural unemployment rise during recessions and fall during expansions

False

GDP using the expenditure approach equals the sum of personal consumption expenditures plus

Gross private investment plus government expenditure on goods and services plus net exports of goods and services.

The marginal product of labor is diminishing because as labor hours

Increase, capital and technology are fixed.

The largest component of GDP in the INCOME APPROACH (ie. national income) is

Labor income (compensation of employees)

Which of the following will shift the loanable funds curve leftward

a decrease in disposable income

purchasing power parity prices

can be used to make more valid per capita GDP comparisons between one country between one country and another.

Economics became known as the dismal science because of the

classical growth theory prediction of subsistence wage rates in the long run

Saving by households

increases when the real interest rate rises

If the central bank (FED) increases the money supply

interest rates will fall

A recessionary gap means that short run macroeconomic equilibrium GDP

is less than full employment GDP

According to the new growth theory of paul romer

knowledge is not subject to diminishing returns

If the nominal interest rate is 10 percent and the inflation rate is 7 percent the real interest rate is approximately..

3 percent

Economic growth is measured by

Changes in real GDP

_______Economists believe that the economy is self regulating and will be at full employment

Classical

The commodity substitution bias is that

Consumers decrease the quantity they buy of goods whose relative price falls

T/F When the economy is at full employment the unemployment rate equals the natural unemployment rate

True

U3

Official unemployment

According to the Boskin Commission, the CPI

Overstates inflation by 1.1 percentage points per year

Labor productivity

Real GDP per hour of labor

T/F The Classical school focuses primarily on monetary policy and the Keynesian school focuses on fiscal policy

True

An assumption of the neoclassical theory of growth is that

all technological advancements are the the result of chance

The equilibrium real interest rate is determined by the

demand for loanable funds curve and the supply of loanable funds curve

A recession causes a decrease in the demand for housing, resulting in substantial layoffs in the construction industry. The people laid off

cyclical unemployment

net exports of goods and services equal the

exports of goods and services minus the imports of goods and services

Net investment equals

gross investment minus depreciation

According to the law of diminishing returns, an additional unit of

labor produces less output the the previous unit

U1

longterm unemployment

Gross domestic product is the total ______ produced within a country in a given time period.

market value of all final goods and services

The income approach measures GDP by adding together compensation of employees, proprietors' income, ___________.

net interest, rental income, and corporate profits.

Which growth theory models growth as a perpetual motion machine

new growth theory

Personal consumption expenditures include all of the following EXCEPT

new housing

The working age population is defined as

people over the age of 16 who are not in jail, hospitalized, or otherwise institutionalized.

The unemployment rate is the ____who are unemployed

percentage of people in the labor force

What is the classical growth theory

real GDP and population growth are inversely tied.

U2

real unemployment

Greater optimism about the expected profits from investment projects

shifts the demand for loanable funds curve rightward

an advance in technology shifts the production function upward and shifts the labor

supply curve rightward

The labor demand curve slopes downward because

the firm maximizes profits by hiring more labor when the real wage rate falls

At potential GDP

unemployment is at its natural rate


संबंधित स्टडी सेट्स

Final Exam Review (Quizzes: One, Two, Nutrition & Pain/Sleep)

View Set

English Test -"it is the fate of actors"

View Set

STATS 212 - CHAPTER 7, 8, and 9 LEARNING CHECKS

View Set

Vocab Unit 6 Synonyms and Antonyms

View Set

Gender and Intersectionality: Doing Gender

View Set