Macroeconomics Final

The CPI was 170 last year and is now 190 this year. What is the inflation rate between the two?

11.8%

The majority of the value of production in the world economy is produced in?

All of the advanced economies taken together

Specialization and trade

Allows nations to consume combinations of products that are outside their individual production

Which of the following is an example of an effort to decrease physical capital differences between an advanced and a developing economy?

American troops build roads in Iraq

In the circular flow how are " values of production", "income" and "expenditures" related?

Expenditures on GDP equals the value of production which equals income

Suppose people decided scooters are no longer fun. The equilibrium price of a scooter ___ and the equilibrium quantity _____.

Falls; decreases

Suppose people decide to buy fewer GE stoves. If GE reduces the number of its ---, which type of unemployment results?

Frictional

The relationship between real GDP and potential GDP over the business cycle can be best summarized

Real GDP fluctuates around potential GDP

Which of the following is true?

Real GDP fluctuates around potential GDP

If prices have decreased since the base period, then

Real GDP is larger than nominal GDP

The real interest rate equals

Nominal interest rate- inflation rate

If you buy a five- year old Tv from a friend, the amount you paid for the TV is

Not included in this years GDP

The labor force is

Number of employed people plus the number of unemployed people

The Human Development Index was proposed because

Of the limitations of real GDPas a measure comparing the standard of living in different nations

Producing an amount of GDP equal to potential GDPis most consistent with economy producing

On the production possibilities frontier

The saying " there no such thing as a free lunch" applies

On the production possibilities frontier

The table above gives the production possibilities frontier for two countries, Anaconda and Bear .The opportunity cost of moving from___ to ___ is greater for ___

Point E to D; Bear

While the FED has a " dual mandate" of goals to achieve, most economists believe that in the long run the single key

Price stability

Suppose the CPR for this year is 133.7. This number means?

Prices rose 33.7% over the base year

The change in quantity of goods and services that an hours work can buy is measured by the

Real Wage

Why does a nation experience increasing opportunity costs?

Resources are not equally productive in producing differs kinds of goods an services

Which of the following is NOT classified as an advanced economy?

Russia

Property taxes are a major source of revenue for

State and local governments

After the passage of North American free trade agreement, which made it less expensive to---found their factories being relocated to Mexico to take advantage lower labor costs

Structural

When government imposes a price floor on a product above the equilibrium price, the government creates a

Surplus

The personal distribution of income shows

That the poorest 20% of households receives less than 4% of total income

As technology advances,

The PPF shifts outward

Among the US, Canada, Russia, India and the UK, the country with the highest average income is?

The United States

The quantity supplied as a good, service or resource is _______ DURING A SPECIFIC PERIOD

The amount that people are able and welling to sell.

Full employment occurs when

The cyclical unemployment rate is 0

The personal distribution of income measures which of the following?

The distribution of income among households

The income approach measure GDP by summing

The incomes paid by household for the resources they own

The law of demand refers to

The quantity demand changes when the price of the good changes

Market equilibrium occurs when

The quantity demanded equals the quantity supplied

When the prices of Oranges increase

The quantity of oranges supplied increases

If the automobiles workers union successfully negotiates a wage increase for its members, how does this wage affect the supply of automobiles?

The supply decreases

To compare the real prices of gas in 1975 to the real prices in 2011, we need to know

The two prices in both years and the CPI in both years

Last year US net exports of goods and serves was negative. This fact means last year

The vale of US exports was less than the value of US imports

In late 2007, the FED began a series of cuts in federal funds rate. Because the core inflation rate was a, cuts was

To avoid a rescission

Which of the following is true

To be classified as employed, you must wrk at least 1 hour a week at a paid job

People come to expect that the price of a gallon of gas will rise next week. As a result of?

Todays demand for gasoline increases

The table above gives the production possibilities frontier for two countries, Anaconda and Bear. Th table shows that

When Anaconda and Bear specialize and trade, Anaconda should produce at its production point E

If a private wage contract is agreed upon with a cost of living adjustment such that wage hikes are equal to increases in the CPI

Workers benefit because the CPI increases more rapidly than does the cost of living

An ____ in the supply of loanable funds ____ the real interest rate and ___ investment

decreases; raises; decreases

Because of the circular flows expenditure and income in the economy, total ____, equals total ____equals total____.

expenditure; income, value of production

A sticky price can be the result of

firms and labor unions entering into long term contract

A competitive market is in equilibrium. Then there is a decrease in demand and a decrease in supply. The equilibrium prices _____and the equilibrium quantity ______.

perhaps changes, but we can't say if it rises, falls or stays the same. Decreased

The Consumer Price Index measures the changes of the

prices paid by consumers for a fixed market basket of consumer goods and services

The total value of capital in the US is around?

47 trillion

Chloe has a 15,000 personal loan at a nominal interest rate of 8%. If the inflation rate is 3% what is the real interest rate paid on the loan?

5%

In January of 2001, the population of the US was 276.8 million, the working - employed was 140, and the total number of people unemployed was 5.0 million

69%

Uppose the 300 million people, the labor force is 200 million people, the-- population is 170 million people. What is the unemployment rate?

7.5%

An item that is purchased to increase business' productive factor

A capital good

Relative to AJ; Joe has ____ if Joe can produce a good show at a lower opportunity cost than AJ

A comparative advantage

Which of the following shift the demand curve for movies leftward?

A decrease in the price of Netflix

The calculation of GDP excludes the values of?

A family member painting the families home

Which of the following is a consumption good or service?

A personal computer in order to play games at home

Consider the following people, Vicki would be classified as a

A voluntary part-time worker

Real GDP measure the value of good and services produced in a given year using

Base year prices

The production possibilities frontier is the

Boundary between the combinations of goods and services that can be produced and the combinations that cannot --- available factors of production and the state of technology

What is the opportunity cost of economic growth?

Consumption Goods

People who are willing and able to work but are not looking for work because they have been discouraged

Discouraged workers

Baby-sitting services the oldest sin provides his parents

Does NOT count as real or nominal GDP

The US economy is experiencing rising output, rising employment, rising incomes and falling unemployment. These conditions best describe cycle ____.

Expansion

As firms search for the best employees to fill an opening and the unemployed search for the job the...

Frictional unemployment

Investment includes

GM's purchase of robotic machinery

Since 1980 the percents of part-time workers who are part time for economic reasons has

Generally increase din recessions and has decreased in expansions

The items included in CPI are

Goods and services consumed by the typical urban household

The alternative measure of the standard living with adjust GDP for the costs of greenhouse gas emissions , environment is called

Green GDP

The total production within an economy is measured as:

Gross Domestic Product

The alternative measure of the standard living that adjust GDP for the cost of depleting nonrenewable resources is called?

Happy Planet Index

Which of the following takes place in factor markets?

Henry receives a commission from his employer for selling a new automobile

Looking at the historical values for annual inflation in the US as measured by Consumer Price Index , its clear that inflation was

Higher on average during the 1970's than during the 1980's

The charitable organization Creating Hope International trains women in Afghanistan to become tailors. This effort reduces

Human capital differences between advanced and developing economies

Between the 1960 and 2010, the labor force participation rate for women

Increased until about 1996

The bias in the CPI effects government outlays because the overstatement of inflation

Increases government outlays by more than what is justified

If a country is operating at a point of production efficiency,

It produces on its production possibilities frontier

Which of the following correctly lists the categories of factors of productions?

Land, labor, capital and entrepreneurship

In the circular flow model, the factor markets are the markets in which

Land, labor, capital and entrepreneurship are bought and sold

Mac can bake more cookies than Monica per hour. It must be true that

Mas has absolute advantage in baking cookies

The largest component of federal government spending is for?

Medicare and medicaid

A real flow in the circular digram is i. a firms payment of wages its workers ii.a households purchase of a new car iii.a farmers use of land to grow corn

ii and iii

Which of the following makes the Consumer Price Index a less accurate measure of the cost of living? i.the monthly price survey conducted to collect information is unreliable ii.the existence of a new goods bias in the calculation of of the CPI iii.the existence of a quality change bias in the calculations of the CPI

ii and iii

Which of the following is included in Germanys GDP?

iii. china produced by the English owned Wedgwood company at a factory in Berlin, Germany

The unemployment rate generally____ during resigns and generally _____.

increases, decreases

Ebay

is a market because buyers and sellers are brought to other to buy and sell.