macro 5-8
Which of the following will NOT cause an increase in the consumption?
James's family debt increases.
If planned investment falls by $1,000 and the MPC is 0.75, the total effect on the economy is a decrease of _____ in income or output
$4000
According to Table 1 below, choose the answer that most accurately estimates Real GDP (2020) of the country Macro-Eco:
$8,655
If income rises from $8,000 to $12,000 and investment increases from $7,000 to $10,000, then MPS is ____ and MPC is _______.
0.25; 0.75
What is the multiplier if the marginal propensity to consume is 0.2?
0.8
Find the equilibrium level of output (Y) for the economy, where the consumption function is given as C=200+0.8Y and the Planned Investment= 50?
1,250
If there are 1,500 people in the population; 800 are employed; and 100 are unemployed, what is the unemployment rate?
11.1%
Because Anna received a raise in pay from $100,000 to 110,000 , her consumption increased from $60,000 to $65,000. What is Anna's marginal propensity to consume?
2
Bistro Belle Vie employs 4 waiters, each working 8 hours, to serve total of 64 tables. What is the per hour productivity of each waiter? Question 7 options:
2 tables per hour
What is the multiplier if the marginal propensity to consume is 0.6?
2.5
How much will $400 in new planned investment change equilibrium income if the marginal propensity to save (MPS) is 0.2?
2000
If the consumer price index (CPI) was 90 in 2017, 100 in 2018, and 105 in 2019, then the base year must be:
2018
People are counted as unemployed if they do not have a job but are available for work and have been actively seeking work for the previous _____ weeks.
4
Bistro Belle Vie employs 3 waiters, each working 6 hours, to serve total of 72 tables. What is the per hour productivity of each waiter?
4 tables per hour
what is the estimate of the natural unemployment rate
4-6%
If the current year's consumer price index is 228 and last year's consumer price index was 218, then the rate of inflation is
4.59
If Susan's salary was $42,000 last year, and this year she receives a cost-of-living increase tied to the consumer price index (CPI), what will her salary be this year assuming the CPI has risen from 104 to 112?
45230
If frictional unemployment is 2%, structural unemployment is 3%, and cyclical unemployment is 4%, the natural rate of unemployment is ______.
5%
Find the equilibrium level of output (Y) for the economy, where the consumption function is given as C=150+0.6Y and the Planned Investment= 60?
525
If MPC is 0.8 and income increases from $10,000 to $11,000, by how much does consumption increase?
800
income approach
A method of computing GDP that measures the income-wages, rents, interest, and profits-received by all factors of production in producing final goods and services.
expenditure approach
A method of computing GDP that measures the total amount spent on all final goods and services during a given period.
Which of the following are generally not counted in GDP?
All of the above are not generally included in GDP.
Inflation can be measured by all of the following except the
All of these answers are used to measure inflation.
Donny, of Donny's Doughnuts, bakes and sells 100 dozen doughnuts a day using one mixer and one fryer. His rival, Sunshine, of Sunshine's Doughnuts, produces 180 dozen doughnuts a day using two mixers and two fryers. Both shops use the exact same technology to make doughnuts and have the same number of workers and the same size building. Donny and Sunshine both increase their capital equipment by one mixer and one fryer. Which shop will benefit the most from its expansion?
Donny, because his workers are more productive per unit of capital and currently have less available capital to work with.
Which of these is NOT used to calculate GDP as part of the income approach?
Government Consumption
recession
Two consecutive quarters of decline
A Japanese automaker produces $1 million worth of automobiles in its factory in the United States. How much of that is added to the GNP of the United States?
USD 0,00
Suppose in 2018 the United States had consumption worth $13 trillion, investment worth $5 trillion, and government spending worth $3 trillion, with $2 trillion in exports and $3 trillion imports. What was its GDP per capita, assuming there were 400 million residents?
USD 50,000
What is a person's classification if he or she has given up actively looking for work?
a discouraged worker
what can a decrease in spending during an economic downturn cause?
a larger drop in income
depression
a prolonged and deep recession
If the MPC = 0.8 and income rises (ΔY) by $5,000, what is the a) MPS and increase in b) saving, and c) consumption ?
a) 0.2; b) ,000; c) 4,000
Inflation is defined as ____________.
an increase in the overall price level.
structural unemployment
caused by changes in structure of economy, consumer demand or technology (usually lasts longer and always exists)
cyclical unemployment
caused by fluctuations in the business cycle (recessions)
Suppose that anticipated inflation is 4% for the coming year, with loan contracts set at 7% with the expectation of a 3% return after inflation. If the actual inflation rate at the end of the year is 2%
creditors gain at the expense of debtors.
Nominal output is measured in ________ dollars and real output is measured in ________ dollars.
current; base year
_____ unemployment is the result of changes in the business cycle. Question 1 options:
cyclical
Which of the following is a type of unemployment that is due to business cycles?
cyclical unemployment
Suppose that anticipated inflation is 5 % for the coming year, with loan contracts set at 9% with the expectation of a 4% return after inflation. If the actual inflation rate at the end of the year is 6%
debtors gain at the expense of creditors.
how do you calculate CPI and inflation
define a base year, and find the cost in that year then find the current cost, and use formula to compare costs
government consumption and gross investment
expenditures by federal, state, and local governments for final goods and services
what does GDP not include
government transfer payments (ss benefits, veteran's disability, stipends, etc.) interest payments on government debt
Georgia health is intending to conduct additional business investments. Which of the following conditions may POSTPONE their investment:
higher interest rates
What macroeconomic condition is described in the article of a newspaper "The official data cited by Credit Libanais shows that food and clothing costs surged 190% and 172% respectively in May from a year earlier. Other reports show similar stats early this month."
hyperinflation
Other things equal, if a recession gets worse, the number of discouraged workers _____, and the number of those in the labor force _____.
increases; decreases
Which of the following will NOT cause an increase in the planned investment?
lower capital goods on hand
The _____ is the state of an economy at which there are no pressures pushing the economy to a higher or lower level of output.
macroeconomic equillibrium
what does the BLS report each month
number of people employed number of people unemployed size of the labor force
multiplier effect
occurs when an initial amount of spending/investment causes income to grow by a larger amount based on the multiplier.
Gross National Product (GNP)
the market value of all goods and services produced domestically and abroad using resources supplied by a country's citizens
contraction, recession, or slump
the period in the business cycle from a peak down to a trough during which output and employment fall
expansion or boom
the period in the business cycle from a trough up to a peak during which output and employment grow
what happens to the multiplier if the MPC is high?
the spending multiplier is high
planned aggregate expenditure
the sum of consumption spending and planned investment spending.
Gross Domestic Product (GDP)
the total market value of all final goods and services produced in a country for a given time period
labor force
total number of those unemployed and employed
who are unaffected by inflation
workers whose ages have escalator clauses social security recipients whose benefits are adjusted with inflation banks that anticipate inflation
If MPC is 0.8 and income increases from $10,000 to $11,000, by how much does saving increase?
$200
productivity
measures how effectively inputs are converted to outputs
frictional unemployment
results from workers who voluntarily quit to search for a better position (usually short-term and always exists)
Inventory might be lower than planned if ____________
sales are stronger than expected
MPC
the fraction of a change in income that is consumed or spent
MPS
the fraction of a change in income that is saved
If income rises from $10,000 to $15,000 and consumption increases from $9,000 to $12,000, then MPC is ____
.60
Which price index calculates the prices for urban consumers paid on fixed basket of goods and services?
CPI
Who benefits from inflation?
Debtors (borrowers) benefit from unanticipated inflation because the real value of their fixed payments falls over time as their wages rise with inflation.
which of the following should not be included in the calculation of GDP
Sharon receives $100 in food stamp
What phase of the business cycle does the headline "Consumer Confidence at Highest Level in Three Years" suggest?
recovery
if MPC is 0.75 and the income increase is $1000, find the MPS, consumption and saving.
MPS=1-0.75 consumption=100*0.75=$75 saving=100*0.25=-$25
In the circular flow diagram________________________
Total expenditures are equal to total receipts (payments)
transfer payment
one-way payment to person or organization which has given or exchanged no goods or services for it.
Every __________ (expenditure) by a buyer is at the same time a ___________(income) for the seller.
payment, reciept
who are harmed by inflation
people living on fixed incomes and creditors or lenders
Which of the following is NOT a contributor to output and productivity growth of a nation?
price controls
what is the key driver of wages and incomes?
productivity
A paragraph from the report discussed in the UN Department of Economic and Social Affairs states that "With the rapid technological advancement of recent years, computers are increasingly encroaching on domains that were previously considered exclusively human. The astonishing progress in such areas as artificial intelligence (AI), robotics, 3D printing and genetics has enabled computers to perform the tasks of architects, medical doctors, music composers and even a 16th century Dutch master of painting. Nearly every day brings news of remarkable feats achieved by computers or robots, and with them a gnawing question: Will machines edge us out of brain jobs?"
structural