ECON 2301 (Chapter 21)

What is the definition of consumption?

Household spending on final goods and services.

Real GDP is?

Is GDP measured in constant prices.

The law of diminishing returns says?

When one input is held constant, increases in the other inputs will, at some point, begin to yield smaller and smaller increases in output.

In 2017, the total population in Africa was estimated to be about 1,250,000,000 people. This number, in billions, is:

1.25

net exports,

Spending on exports minus spending on imports; also referred to as the trade balance.

What is the definition of Investment?

Spending on new capital assets that increases the economy's productive capacity.

labor productivity means?

The quantity of goods and services that each person produces per hour of work.

Imports

are goods and services that are produced in other countries and purchased by domestic U.S. buyers.

Exports

are goods and services that we produce domestically in the United States and sell to people and businesses in other countries.

The rapid growth that occurs when a relatively poor country invests in physical capital is known as

catch-up-growth

property rights

control over a tangible or intangible resource.

Which of the following is a scaled number?

government budget deficit as a percentage of GDP.

constant returns to scale

increasing all inputs by some proportion will cause output to rise by the same proportion.

What is the difference between spending from a microeconomics standpoint and spending from a macroeconomics standpoint?

spending refers to spending by you, your family, or your company, whereas in macroeconomics, spending refers to the spending by all consumers, all businesses, and the government in the economy.

constant returns to scale, which means?

that increasing all inputs by some proportion will cause output to rise by the same proportion.

Ideas can be freely shared. My use of a new idea doesn't make it harder for you to use that idea. Economists refer to this as "nonrival," which means?

that one person's use of an idea doesn't subtract from another's.

Which of the following is an example of transfer payments?

unemployment benefits.

human capital

which describes the knowledge and skills that workers bring to the job.

physical capital

which describes the tools, machinery, and structures we work with.

transfer payments

which transfer income from one entity (the government) to another (an individual).

which of the following is an example of a durable good?

your new car

capital stock is?

is the total quantity of physical capital, and it includes all equipment and structures that can be used in the production of goods and services.

Economists refer to output per hour worked as?

labor productivity

technological progress

new methods for using existing resources.

You purchase a new car (produced this year) for 38,000. After six months, you sell the car for 31,500. How much does GDP rise because of these two transactions.

38,000

In 2010, Canada's GDP was approximately 1,357 billion, and its population was about 34.12 million. What was Canada's approximate GDP per person in 2010?

39,770, you have to divide 1,357 b/34.12 m

Nominal GPD is?

Is GDP measured in today's prices.

What is the difference between microeconomics and macroeconomics?

Microeconomics is the study of individual decisions in specific markets, whereas macroeconomics is the study of the economy as a whole.

Dale is a stay-at-home parent whose typical day consist of getting the kids ready for school, doing the laundry, cooking three meals, and cleaning the house. How are Dale's home activities counted in GDP?

They are not counted.