USF Macro Final

In the graph, an increase in quantity demanded would be represented by a change from point ato point _____, while a decrease in demand would be represented by a change from point dto point _____. b; b c; b b; c c; c

c; c

If frictional unemployment is 2%, structural unemployment is 3%, and cyclical unemployment is 4%, the natural rate of unemployment is -7%. -9%. -2%. -5%.

-5%.

Which situation would result in a change in the quantity demanded (as opposed to a change in demand) for beanbag chairs? a decrease in the price of beanbag chairs an increase in popularity of beanbag chairs a decrease in the price of video game consoles, a complement to beanbag chairs an increase in the number of potential buyers of beanbag chairs

a decrease in the price of beanbag chairs

When the increase in prices goes from 5% to 2%, this is referred to as -disinflation. -inflation. -hyperinflation. -deflation.

disinflation

If the price of used plug-in electric cars is expected to rise in six months, the reaction in the supply of those cars in the market today would likely be a(n) downward movement along the supply curve. shift of the supply curve to the left. upward movement along the supply curve. shift of the supply curve to the right.

shift of the supply curve to the left.

Assume that a student attends a four-year college with tuition costs of $20,000 per year; room and board costs of $5,000 per year; and books/entertainment costs of $1,000 per year. If the student did not go to college, she would work at a job that pays $25,000 per year but still face the same room and board, as well as entertainment expenses. The opportunity cost of attending college for this student for four years is $124,000. $100,000. $180,000. $80,000.

$100,000.

If the CPI increases from 150 to 153 and a person's monthly retirement benefit has an escalator clause that ties it to the CPI, by how much would the monthly payment increase if the original amount is $750? - $15.00 -$7.50 -$22.50 -$30.00

- $15.00

If a country's GDP is $200 million and its total population is 10,000, but only 8,000 of these people work, the country's per capita income is -$25,000 - $20,000. -$100,000. -$11,111.

- $20,000.

If C= $4 million, I= $2 million, G= $1 million, X= $1 million, and M= $2 million, the value of GDP in this economy is - $6 million. -$8 million. -$10 million. -$4 million.

- $6 million.

Suppose the town of Treeville has a population of 200, of which 120 are in the labor force. Of those in the labor force, 100 are employed and 20 are unemployed. The unemployment rate in Treeville is -60%. - 17%. -10%. -20%.

- 17%.

Suppose there are three massage therapists, with a supply schedule that indicates their willingness to supply massages at various prices. What is the market quantity of massages supplied at $60, and does this supply schedule follow the law of supply? -47; yes - 29; yes -47; no -29; no

- 29; yes

One of the criticisms of the way business cycles are officially dated by the NBER is that - it uses historical data to date phases after they occur. -the committee consists of hundreds of economists with different perspectives. -it makes predictions based on estimated future growth data. -it relies on too many indicators of economic activity to be accurate.

- it uses historical data to date phases after they occur.

A guitar is produced in California using $100 in raw materials and sells for $300 in a guitar shop. Each guitar that is produced contributes _____ to U.S. GDP. -$200 -$300 -$100 -$400

-$300

What would be a reason an economy is operating at point D? -An economy experiences an influx of immigrants seeking jobs. -An economy uses all of its inputs efficiently but changes the ratio of the goods produced. -There is a new technological breakthrough in the production of energy-efficient airplanes. -A reduction in business investment causes unemployment to increase.

-A reduction in business investment causes unemployment to increase.

Rational behavior requires thinking at the margin. Which example represents this type of thinking? -deciding whether the overtime pay is worth working on your day off -deciding whether to pay a fine for polluting the local harbor or installing antipollution machinery -deciding whether a second burger is worth the extra $2 -All of these examples represent thinking at the margin.

-All of these examples represent thinking at the margin.

The popularity of indoor hammocks has increased as people seek unique ways to relax. At the same time, the cost of producing indoor hammocks has fallen. Based on this information, what is the change in the equilibrium price and quantity of indoor hammocks? -Equilibrium price decreases but quantity increases. -Equilibrium price rises but quantity is indeterminate. -Equilibrium price and quantity both increase. -Equilibrium price is indeterminate but equilibrium quantity increases.

-Equilibrium price is indeterminate but equilibrium quantity increases.

Which event is LEAST likely to result in inflation? -Rampant government debt leads to excessive printing of money. -Increasing imports causing domestic manufacturers that are unable to compete to be displaced. -Strong consumer confidence leads to robust spending on luxury goods. -A severe drought in the South results in a reduced harvest.

-Increasing imports causing domestic manufacturers that are unable to compete to be displaced.

Which person is considered part of the labor force? -Tessa, an 8-year-old who sells lemonade on the sidewalk for 50 cents a glass -Joe, a senior in high school who works part-time on weekends at the ice cream shop -Jamal, who just graduated from college and is backpacking in Europe for six months -Mary, who works as a librarian in prison because she poisoned her cheating boyfriend

-Joe, a senior in high school who works part-time on weekends at the ice cream shop

Which is not a purpose that prices play in a market? -Prices communicate information about consumer preferences. -Prices rarely change, which allows markets to be more stable. -Prices can help sellers determine what goods to sell. -Prices give buyers a means of comparing goods that are substitutes.

-Prices rarely change, which allows markets to be more stable.

Collegetown's unemployment rate is 5%. After graduation, students who previously did not work actively seek jobs but only 80% find work right away. The rest continue to actively look for jobs. How does Collegetown's labor force participation rate and unemployment rate change? -The labor force participation rate decreases and the unemployment rate decreases. -The labor force participation rate increases and the unemployment rate increases. -The labor force participation rate increases and the unemployment rate decreases. -The labor force participation rate decreases and the unemployment rate increases.

-The labor force participation rate increases and the unemployment rate increases.

Suppose that Felicia borrowed $10,000 from Wells Fargo to pay for college expenses and the inflation rate dropped unexpectedly. Who is likely to benefit from this change? -Neither Felicia nor Wells Fargo would benefit from this change. -Both Felicia and Wells Fargo are likely to benefit equally from this change. -Wells Fargo benefits because the money being paid back has more purchasing power than expected. -Felicia benefits because the money she pays back has less purchasing power than expected.

-Wells Fargo benefits because the money being paid back has more purchasing power than expected.

Which question would NOT be considered one of the basic economic questions? -When will the new high-speed train in California be completed? -To whom will the production of solar panels be sold to? -Should Brazil continue to produce ethanol? -What production method should be used to make batteries for plug-in cars?

-When will the new high-speed train in California be completed?

Which of these would NOT be considered a factor of production? -a bank loan used to start a new business -mineral deposits -a large copy machine at the office -college graduates seeking a job

-a bank loan used to start a new business

Which scenario would NOT result in a shift in the supply curve for miniature golf rounds? -an increase in labor wages paid to the staff that operate the miniature golf course -a decrease in the price of go-kart racing, a substitute for miniature golf -a new subsidy given to all operators of outdoor activities -an expectation of a future surge in popularity of miniature gol

-a decrease in the price of go-kart racing, a substitute for miniature golf

Which factor is MOST likely to shift an entire PPF outward? -a general increase in the price of inputs -a natural disaster that disrupts production -a general increase in educational attainment -a technology improvement in one key industry

-a general increase in educational attainment

Which reason does NOT contribute to a higher level of unemployment? -the existence of efficiency wages -a lack of labor mobility as people choose to remain in their hometown -a reduction in economic activity due to a recession -a reduction in union bargaining activities

-a reduction in union bargaining activities

When two countries specialize and trade based on their comparative advantage -both countries remain at their original point on the PPF because trade primarily affects consumption. -both countries are able to consume at a point beyond the original PPF. -both countries would move to a different point on the existing PPF. -the country with the greater comparative advantage moves beyond its PPF while the other falls below it.

-both countries are able to consume at a point beyond the original PPF.

Which group is most likely to be harmed by international trade? -businesses that produce goods primarily for export -businesses who produce goods that compete against imports -consumers who buy imported goods for consumption -businesses who buy imported raw materials for production

-businesses who produce goods that compete against imports

If a country calculates its real GDP using the year 2012 as its base year, the value of its real GDP will be _____ its nominal GDP as long as prices have risen since 2012. -not comparable to -equal to -greater than -less than

-greater than

The general purpose of the circular flow diagram is to show that total _____ equal(s) total _____ in an economy. -savings; spending -investment; spending -inputs; outputs -spending; income

-inputs; outputs

Which of these would NOT be included in official GDP measures? -value of a country's exports -purchase of books on how to live a healthier life -cost of installing environmentally friendly solar panels -lost wages from taking time off work due to bad air pollution

-lost wages from taking time off work due to bad air pollution

IKEA (a Swedish home furnishings company) produces desks that are made in Poland. The value of these imported desks sold at an IKEA store in the United States counts toward -U.S. GNP. -U.S. GDP. -both U.S. GDP and GNP. -neither U.S. GDP nor GNP.

-neither U.S. GDP nor GNP.

Which component is NOT used to measure GDP via the income approach? -rental income -corporate profits -net exports -net interest

-net exports

Suppose that a major drought causes a 30% reduction in the peanut harvest. If there is no change in demand, this event would cause a _____ at the original equilibrium price, and the equilibrium price will therefore _____ and the equilibrium quantity will _____. -shortage; rise; fall -surplus; fall; rise -shortage; rise; rise -surplus; fall; fall

-shortage; rise; fall

Technological advancements in mobile banking (such as electronic check deposits and mobile money transfers) are expected to reduce the number of bank teller jobs by around 8% over the next decade. What type of unemployment will this create? -frictional -cyclical -persistent -structural

-structural

If a country's PPF is linear, this means that _____ along the PPF. -diminishing returns to production sets in as one moves in either direction -the opportunity cost changes as one moves upward -the opportunity cost remains constant at all points -the opportunity cost changes as one moves downward

-the opportunity cost remains constant at all points

he table shows the amount of cherries or apples that Chile and Argentina can produce using one day of labor. The opportunity cost of producing 1 cherry is _____ in Chile and _____ in Argentina. _____ has a comparative advantage in cherry production. -2 apples; 3 apples; Chile - 0.5 apple; 0.33 apple; Argentina -2 apples; 3 apples; Argentina -0.5 apple; 0.33 apple; Chile

0.5 apple; 0.33 apple; Argentina

Yoko recently graduated from college and is enjoying more income from working. She finds herself buying more art supplies from Mimi's Art Boutique and fewer art supplies from the local Walmart. What can we conclude from Yoko's buying habits? Art supplies from Mimi's are inferior goods, and those from Walmart are normal goods. Art supplies from both Mimi's and Walmart are normal goods. Art supplies from Mimi's are normal goods, and those from Walmart are inferior goods. Art supplies from both Mimi's and Walmart are inferior goods.

Art supplies from Mimi's are normal goods, and those from Walmart are inferior goods.

Consider the following statements. Which, if any, are positive statements?I. Main Street needs more coffee shops.II. A new parking garage on campus will reduce parking congestion.III. Last winter, the state should have spent more money on snow removal. -I and II -II only -I, II, and III -I

II only

Which situation(s) may require government intervention?I. A local business has made a profit in each of the last 10 years.II. Students are having difficulty deciding whether to go the beach or to go hiking for their class trip.III. A manufacturing firm on a river is dumping production runoff into the water. II only III only II and III I and II

III only

Which scenario is not possible for two countries who trade computers and automobiles with one another? -One country does not have an absolute advantage in either product but has a comparative advantage in one product. -One of the countries has an absolute advantage in the production of both products. -One country has an absolute advantage in one product and a comparative advantage in the other product. -One of the countries has a comparative advantage in the production of both products.

One of the countries has a comparative advantage in the production of both products.

When economists assume people make rational decisions, it means that -a rational person can never appear to make irrational decisions. -a rational person will respond to the benefits and costs associated with incentives. -people never make mistakes. -people are always selfish.

a rational person will respond to the benefits and costs associated with incentives.

If the equilibrium price of lychee fruit has fallen while the equilibrium quantity has risen, which factor may have caused it? -a rise in popularity in the consumption of lychee fruit -a reduction in the price of related commodities using the same type of land for production -a severe drought that caused many sellers to leave the market -an increase in the price of rambutan fruit, a substitute for lychee fruit

a reduction in the price of related commodities using the same type of land for production

Which policy is MOST likely to contribute to improved standards of living over time? -reducing the years that drug patents are valid to speed up production of generic versions -addressing teacher shortages by closing schools and busing students to other schools -adding after-school art and music programs to promote creativity -allowing individuals the freedom to circumvent laws due to personal objections to them

adding after-school art and music programs to promote creativity

Although the United States hardly produces any coffee, it is able to acquire various types of coffee from other countries to satisfy the desires of every American coffee drinker. This example best represents _____ efficiency. -marginal -Pareto -allocative -production

allocative

When each member of a farm co-op specializes in one task, this will generally lead to -some members becoming better off while some become worse off. the same outcome as without -specialization because it has a neutral impact on productivity. -gains to all members as long as trade is possible. -a worse outcome than if every member learns how to do every task as best as they can.

gains to all members as long as trade is possible.

A recent decision regarding the Federal Reserve's impending interest rate increase is an example of a _____ topic. On the other hand, a debate on the impact of the arrival of Uber on local taxi businesses is an example of a _____ topic. microeconomics; macroeconomics macroeconomics; microeconomics microeconomics; microeconomics macroeconomics; macroeconomics

macroeconomics; microeconomics

Reasons to study economics include all of these EXCEPT that you -will learn exactly how to invest your cash in the short term for the highest return on investment. -may become a better prepared voter. -will always live in a world of scarcity and choices. -will understand more about how governments and businesses interact.

will learn exactly how to invest your cash in the short term for the highest return on investment.