Macro Exam 2

Madelyn goes to college and reads many books while at school. Her education measures which of the following FOP?

Human Capital.

What is not a characteristic of minimum wage workers?

Full time.

The study of a company's accounting statements and future prospects to determine its value is known as

Fundamental Analysis.

Once a country is wealthy..?

It may be harder for it to grow quickly because of the diminishing returns to capital.

According to the BLS, a husband who chooses to stay home and take care of the household is

Not included in the LF.

The amount today that would be needed, at prevailing interest rates, to produce particular sum in the future is known as

Present value.

National Savings is equal to

Private + Public Saving

If GDP = $1000, consumption = $700, taxes = $50, and the government purchases= $300, how much is savings and investment?

They are both zero. S = I in a closed economy. S = Y - C - G.

the Unemployment rate is

Unemployed/Labor Force x100 (6.46%)

An increase in the budget deficit is

a decrease in public saving.

Our Standard of Living is most closely related to

our productivity because our income is equal to what we produce.

What government policy would fail to lower unemployment rate?

raising minimum wage

Diversification of a portfolio can

reduce firm specific risk.

The Labor Force is

the Unemployed + Unemployed. (105.2 Million in the example)

If the government spending exceeds tax collections,

there is a budget deficit.