Macroeconomics test 1
National income and product accounts came about in the United States during the 1930's as a result of:
a lack of reliable economic data
When the economy is operating at full employment:
cyclical employment is zero
Simon Kuznets is known for what?
devising the gross national product as a way of measuring the nation's economic output
Government expenditures include _________ and _________, but NOT _______ .
wages and salaries; the purchase of products and services; transfers
formula for Consumer Price Index
(cost in current period /cost in base period) x100
last year, the consumer price index (CPI) was 115 while the consumer price index for this year is 125. What is the rate of inflation?
8.7%
formula for GDP
C + I + G + ( X - M ) consumption expenditure investment government purchase of goods net exports ( exports-imports )
true or false: If inflation is unanticipated, then income may be redistributed from creditors to debtors.
True
formula for % change in price
[(CPI in current year/ CPI in original year) x100]-100
formula for consumer expenditure
autonomous consumption+marginal propensity to consume
If the cost of a typical market basket in 2019 is 400 and the cost of a typical market basket in 2020 is 390, then during this period the economy is undergoing:
deflation
in 1933, congress directed the _______to develop estimates of "total national income for each of the calendar years for 1929, 1930, and 1931..."
department of commerce
Wages set high to discourage employee turnover are called ___________ wages
efficiency
Which of the following is/ are considered employed? population military employed unemployed seeking work unpaid family working 15+ hours a week retired
employed AND unpaid family working 15+ hours a week
true or false: As a measure of inflation, the media gives more attention to the GDP deflator than the consumer price index.
false
Assume you read an article for class concerning the US labor market that reports an increase in entrepreneurial activity. To verify this information, you could refer to the:
household surveys
Hannah is not at work because she broke her leg, but she will return once it is healed. She is:
in the labor force
formula for labor force participation rate
labor force / population
formula for real value
nominal value / (nominal price index/ price index of base year)
Roughly half of the unemployment consists of:
people who lost their job
What factors go into GDP in reference to the Expenditure approach?
personal consumption expenditures gross private domestic investment government purchases net exports of goods and services
what goes into the formula for GDP for the income approach?
proprietors' income, compensation of employees, corporate profits, rental income, net interest
formula for natural rate of unemployment
structural unemployment + frictional unemployment
inventory investment
the difference between goods produced and goods sold
formula for unemployment rate
unemployed / employed+unemployed
Which of the following is/are considered unemployed? population military employed unemployed seeking work unpaid family working 15+ hours a week retired
unemployed seeking work ONLY
What component of GDP includes college tuition?
Services
In the national income and product accounts system, the two main approaches to measuring the size of the economy are:
income and expenditures