ECON In Class Test 2
Nate collect Social Security payments of $220 a month in Year 1. If the price index rose from 90 to 108 between Year 1 and Year 2, then his Social Security payment for Year 2 should have been.
264
Last year real GDP per person in the imaginary nation of Olympus was 4250. The year before it was 4100. By about what percentage did Olympian real GDP per person grow during the period ?
3.7 percent
Octavia does not currently have a job, but she has applied for several jobs in the previous week. Eve is an unpaid stay-at-home mom who has not searched for work in recent years. Who does the Bureau of Labor Statistics count as "not in the labor force">
Eve but not Octavia
Bob deposits $100 in a bank account that pays an annual interest rate of 5 percent. A year later, Bob withdraws his $105. If inflation was 5 percent during the year the money was deposited. then Bob's purchasing power has not changed
False
U.S. GDP and U.S. GNP are related as follows:
GNP= GDP - income earned by foreigners in the U.S + Income earned by U.S citizens abroad.
Economist Robert Fogel focused on which of the following factors as one determinant of long run economic growth ?
Nutrition
An increase in the price of bread produced domestically will be reflected in
both the GDP deflator and the consumer price index
The producer price index measure the cost of a basket of goods and services
bought by firms
One of the widely acknowledged problems with using the consumer price index as a measure of the cost of living is that the CPI
fails to account for the introduction of new goods
In recent decades, Americans have increased their purchase of stocks of foreign based companies. The Americans who have bought these stocks were engaged in
foreign portfolio investment
When the consumer price index rises, the typical family
has to spend more dollars to maintain the same standard of living
In early 1900s, Henry Ford introduced a
high-wage policy, and this policy produced many of the effects predicted by efficiency-wage theory.
Education attainment tends to be
low in countries with high population growth
Proprietary technology is knowledge that is known
only by the company that discovered it
cyclical unemployment refer to
short-run fluctuations around the natural rate of unemployment
Sheila is on a temporary layoff from her automobile factory job but has not looked for work in the last four weeks. The Bureau of Labor Statistics counts Sheila as
unemployed and in the labor forc
Sue Holloway was an accountant in 1944 and earned $12000 that year. Her son, Josh Holloway, is an accountant today and he earned $210000 in 2017. Suppose the price index was 17.6 in 1944 and 218.4 in the current year. In real terms, Sue Holloway's income amounts to about what percentage of Josh Holloway's income ?
70.9 percent
Which of the following is included in GDP ?
Both the market value of rental housing services and the market value of owner-occupied housing services.
Many things that society values, such as good health, high-quality education, enjoyable recreation opportunities, and desirable moral attributes of the population, are not measured as part of GDP. It follows that
GDP is still a useful measure of society's welfare because it measures a nation's ability to purchase the inputs that can be used to help produce the things that contribute to welfare.
Suppose the government passes a law eliminating holidays and, as a result, the production of goods and services increase because people work more days per year (and thus enjoy less leisure per year). Based on this scenario, which of the following statement is correct.
GDP would definitely increase because GDP excludes leisure
Which of the following countries has had the greatest growth rate of real GDP per person within last 10 years ?
Germany
Which of the following statistics is usually regarded as the best single measure of a society's economic well-being?
Gross domestic product
Joe and Jim purchase vegetables at a grocery store, but Jim also grows vegetables in his backyard. Regarding these two practices, which of the following statements is correct ?
Only Joe's and Jim's grocery store purchases are include in GDP
Which of the following is the correct formula for calculating the consumer price index ?
[(price of basket of goods and services in current year/price of basket in base year)] x 100
GDP and GNP are identical when
all domestic production is by domestically owned producers and no foreign production is carried out by domestic producers.
The traditional view of the production process is that capital is subject to
diminishing returns
If your firm's production function has constant return to scale, then if you double all your inputs, your firm's output will
double but productivity will not change
If total spending rises from one year to the next, then
either the economy must be producing a larger output of goods and services, or goods and services must be selling at higher prices, or both
A Texas household receives a Social Security check for $1500, which it uses to purchase a $40 pair of shoes made in Thailand by a Thai firm, a $1240 television made by a Korean firm in Korea, and $220 on groceries from a local store. As a result, U.S. GDP
increase by $220
The term economists use to describe in which the economy's overall price level is rising is
inflation
International data on GDP and socioeconomic variables
leave no doubt that a nation's GDP is closely associated with its citizens' standard of living.
International studies of the relationship between GDP per person and quality of life measure such as life expectancy and literacy rates show that larger GDP per person is associated with
longer life expectancy and higher percentage of population that is literate
The following table retains to Wrexignton, an economy in which the typical consumer's basket consist of 20 pounds of meat and 10 toys. Year 1: $3 per pound and $2 per toys Year 2: $1 per pound and $7 per toys Year 3: $4 per pound and $5 per toys The inflation rate was
positive in Year 2 and positive in year 3
Social Security payments are indexed for inflation using
the CPI
In 1870, the richest country in the world was
the United Kingdom
As long as prices are rising over time, then
the nominal interest rate exceeds the real interest rate
People who report being unemployed but who. In fact, are working for "under the table" pay to avoid taxes on their earnings are really employed and therefore cause the reported unemployment rate to be higher than it would otherwise be.
True
In the 1990s Ireland made unemployment benefit less generous. This change would likely have reduced
frictional unemployment but not the natural rate of unemployment
A transfer payment is a payment made by
government, but not in exchange for a currently produced good or service.
Teenagers have more frequent unemployment spells and spend more time searching for jobs. Other thing the same, this mean that teenagers have a
higher unemployment rate. If a larger of the adult population were teenagers, the natural rate of unemployment would be higher.
The real interest rate tells you
how fast the purchasing power of your bank account rises over time
In the CPI, goods and services are weighed according to
how much consumers buy of each good or service
If over a short time there is an increase in the number of people retired and a decrease in the number of people working, then productivity
rises but the real GDP per person falls
The natural rate of unemployment
varies less than the measured unemployment rate
Which of the following items is the one type of household expenditure that is categorized as investment rather than consumption ?
The purchase of a new house
Which of the following statement is correct about the relationship between the nominal interest rate and the real interest rate
The real interest rate is the nominal interest rate minus the rate of inflation
Who of the following is not included in the Bureau of Labor Statistics "employed" category?
Those waiting to be recalled to a job from which they had been laid off.