Ap Econ unit 4

Net exports

exports minus imports

In calculating GDP, governmental transfer payments, such as social security or unemployment compensation, are:

not counted

Anne Kasperson works in her own home as a full-time caretaker and homemaker. Officially, she is:

not in the labor force

Tom Atoe grows tomatoes for home consumption. This activity is:

productive but is excluded from GDP because no market transaction occurs.

If The Consumer Price index rises from 300 to 333 in a particular year, the rate of inflation in that year is:

11 percent

If a nation's real GDP is growing by 5 percent per year, its real GDP will double in approximately:

14 years

If real GDP in a particular year is $80 billion and nominal GDP is $240 billion, the GDP price index for that year is:

300

The full-employment unemployment rate means an unemployment rate of about:

5%

Assuming the total population is 100 million, the civilian labor force is 50 million, and 47 million workers are •employed, the unemployment rate is

6 percent

Assume the natural rate of unemployment in the U.S. economy is 5 percent and the actual rate of unemployment is 9 percent. According to Okun's law, the GDP gap is:

8%

Which of the following is a final good or service?

Haircut

For every I percentage point that the actual unemployment rate exceeds the natural rate, a 2 percentage point GDP gap occurs." This is a statement of:

Okun's law

Which of the following constitute the unemployment occurring at the natural rate of unemployment?

structural and frictional unemployment

The type of unemployment associated with recessions is called:

cyclical unemployment

GDP can be calculated by summing:

Consumption, investment, government purchases, and net exports

The phase of the business cycle in which real GDP declines is called:

Recessionary

In 2000 Onega's nominal income rose by 6.5 percent and the price level rose by 3.5 percent. We can conclude that Ortega's real income:

Rose by 3%

In national income accounting, consumption expenditures include purchases of:

automobiles for personal use, but not houses.

Recurring upswings and downswings in an economy's real GDP over time are called:

business cycles

Economic growth is best defined as an increase in:

either real GDP or real GDP per capita.

Kimberly voluntarily quit her job as an insurance agent to return to school full-time to earn an MBA degree. With degree in hand she is now searching for a position in management. Kimberly presently is:

frictionally unemployed

GDP

is the dollar value of the total output produced within the borders of the nation

Okun's Law

shows the relationship between the unemployment rate and the size ofthe GDP gap.

Eckstein has lost her job in a Massachusetts textile plant because of import com. She intends to take a short course in electronics and move to Califomia where she anticipates that a new job will be available. We can say that Eckstein is faced with:

stuctural unemployment

Which of the following is not economic investment?

the purchase of 100 shares of AT&T by a retired business executive

Which of the following do national income accountants consider to be "investment"?

the purchase of a new house

The phase of the business cycle in which real GDP is at a minimum is called

trough