macro midterm

In 1995, when the consumer price index was 152.38, women earned a median income of $12,130 per year. If the consumer price index in 2015 was 236.99, how much was $12,130 in 2015 dollars? $12,130 $7,799 $18,865 $16,259

$18,865

When plotting a supply curve the quantity supplied goes on the vertical axis. the quantity demanded goes on the vertical axis. the quantity supplied goes on the horizontal axis. the price goes on the horizontal axis.

the quantity supplied goes on the horizontal axis.

If the frictional rate of unemployment is 1.45%, the structural rate of unemployment is 2.3%, and the total unemployment rate is 6%, then we can conclude that: the equilibrium rate of unemployment is 3.75%. the economy is experiencing an economic boom. the labor force participation rate has fallen significantly. there is 2.25% actual unemployment.

the equilibrium rate of unemployment is 3.75%.

In 2017, the total population of Africa was estimated to be about 1,250,000,000 people. This number, in billions, is: 12.5. 1.25. 125. 1,250.

1.25

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? $26,246 $3,980 $46,060 $39,770

$39,770

Kevin Williamson goes to a local coffee shop and orders a medium-sized latte. His willingness to pay for that latte is $6. The price of the latte is $2. The cost to the coffee shop to produce the latte is $1. How much economic surplus does Kevin gain when he purchases the latte? $1 $4 $6 $2

$4

In 1971, the cost of a four-year college degree from a public university was about $1,410. The consumer price index was 40.48 in January 1971. If the current consumer price index is 251.1, what is the approximate cost of the four-year degree in current dollars? $227 $9,422 $8,746 $1,410

$8,746

Which of the following would be considered in a cost-benefit analysis to decide if a person should cycle to work or ride the subway?(i) The air pollution that the cyclist has to breathe.(ii) The cost of subway tickets.(iii) The time it takes to cycle to work versus the time it takes to ride the subway to work.(iv) The cost per gallon of gasoline. (i), (ii) and (iii) (i), (iii) and (iv) (i), (ii), (iii) and (iv) (i), (ii), and (iv)

(i), (ii) and (iii)

You purchase a certificate of deposit that earns an advertised rate of 1.75% interest per year. What is your real rate of return if the actual inflation rate is 1.9%? 1.75% -0.15% 0.15% 3.65%

-0.15%

You purchase a certificate of deposit and expect an inflation rate of 1.5% over the next year. Your nominal rate of interest is 2.25%. What is your expected real rate of return? 3.75% 0.75% 2.25% -0.75%

0.75%

Consider the following basket of goods: 50 bottles of milk, 100 avocadoes, 50 apples, and eight pineapples. Suppose that last year, each bottle of milk was $2.50, each avocado was $1.50, each apple was $0.75, and each pineapple was $4. This year, each bottle of milk is $2.50, each avocado is $1.80, each apple is $0.80, and each pineapple is $4.30. What is the inflation rate between last year and this year? -9.09% 10.13% -10% 8.99%

10.13%

What is Sri Lanka's GDP deflator if its nominal GDP is $88.9 billion (in current US$) and the real GDP is $59.34 billion? 66.7 100 136.5 149.8

149.8

Which of the following lists only the factors that would cause a decrease in the supply of an item? A rise in input prices; a decrease in the number of sellers in the market; a rise in the price of a substitute-in-production. A rise in the price of a substitute-in-production; a rise in the price of a complement-in-production; an expectation that the price of the item will rise in the future. A fall in input prices; an increase in productivity; a fall in the price of a substitute-in-production. A decrease in the number of sellers in the market; a fall in the price of a complement-in-production; an increase in productivity.

A rise in input prices; a decrease in the number of sellers in the market; a rise in the price of a substitute-in-production.

Which of the following scenarios depicts a seller who is following the Rational Rule for Sellers? Andy's Diner finds that the marginal cost of a fish and chips meal is $7 and lists the item for sale at $6.50. Mindy sets up a lemonade stand and calculates the cost of an additional cup of lemonade at 50 cents, and sells it for 25 cents. American Airlines determines the marginal cost of an extra passenger to be $75 and sells a discount seat for $250. An auto-rickshaw driver in New Delhi, India, calculates a trip to have a marginal cost of 350 rupees and accepts a ride request for 315 rupees.

American Airlines determines the marginal cost of an extra passenger to be $75 and sells a discount seat for $250.

Which of the following will fall when the economy is expanding? Business confidence Nonfarm payrolls Applications for unemployment benefits Consumer confidence

Applications for unemployment benefits

An example of a leading indicator is: the stock market. unemployment. nonfarm payrolls. unemployment insurance claims.

the stock market.

Which of the following shows the medium of exchange function of money? Wilma wants to sell her old car, and she values it at $2,400. Darius goes window shopping. Mena saves his money in a certificate of deposit at the bank. Daniela goes to the store and purchases roses with U.S. dollars.

Daniela goes to the store and purchases roses with U.S. dollars.

A bakery hires a baker who can make 15 cakes per day. The bakery then decides to hire a second baker who will use the kitchen at the same time as the first baker. The bakery finds that the second baker can produce only an additional nine cakes per day. What concept does this scenario illustrate? The cost-benefit principle The marginal principle The opportunity cost principle Diminishing marginal product

Diminishing marginal product

If an economy has a positive output gap of 1.5%, this means: GDP is 1.5% above potential GDP. GDP is 1.5% below potential GDP. unemployment is 1.5% above the natural rate of unemployment. inflation is 1.5% above the long-run rate of inflation.

GDP is 1.5% above potential GDP.

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? GDP rises by $38,000. GDP rises by $6,500. GDP rises by $69,500. GDP rises by $31,500.

GDP rises by $38,000.

How is the economic surplus generated by a decision calculated? It is the total benefits minus total costs arising from the decision. It is the sum of costs arising from the decision. It is the sum of benefits arising from the decision. It is the total benefits plus total costs arising from the decision.

It is the total benefits minus total costs arising from the decision.

Which of the following will probably rise when the economy is in a recession? Employment Real GDP growth Real retail sales Initial unemployment claims

Initial unemployment claims

What is quantity supplied? It is a graph that plots how much a seller produces at different points in time. It is the amount of an item that a seller is willing to sell at a particular price. It is the amount of an item that a buyer is willing to buy at a particular price. It is a graph that plots the quantities of an item that a seller plans to sell at different prices.

It is the amount of an item that a seller is willing to sell at a particular price.

Which of the following scenarios illustrates the law of demand? A research company finds that the more expensive a particular brand of a designer handbag, the more that consumers are willing to purchase the brand. Kathleen eats more steak when the price is low, and less when the price is high. John likes to drink spring water. At $2 he buys four bottles of water, and at $1.50 he still buys four bottles of water. Francis does not care about the price of coffee at the coffee shop - he must buy two cappuccinos every day, regardless of the price.

Kathleen eats more steak when the price is low, and less when the price is high.

You have four friends. Which of your friends can be described as "cyclically unemployed"? Martha, who is a full-time stay-at-home parent Keele, who lost her job after her company lost a lot of customers during an economic downturn Arthur, who quit his job to look for a better job Regan, who is in a nursing home

Keele, who lost her job after her company lost a lot of customers during an economic downturn

Which of the following is a broad indicator? Real gross domestic income Labor demand in the agricultural industry Starbucks stock returns Agricultural sector output

Real gross domestic income

Which economic indicator tells you about the future expected profits of businesses? Initial unemployment claims Consumer price index S&P 500 Nonfarm payrolls

S&P 500

Which economic indicator tells you how fast wages and benefits are rising? Business confidence Nonfarm payrolls S&P 500 The employment cost index

The employment cost index

Which of the following is NOT a factor that can shift supply? The price of a complement-in-production. The expected future price of a product. The market price of a product. The price of a substitute-in-production.

The market price of a product.

Which principle tells you that the true cost of something is the next best alternative you have to give up to get it? The opportunity cost principle. The marginal principle The cost-benefit principle. The interdependence principle.

The opportunity cost principle.

Which of the following is a narrow indicator? Non-farm payrolls The stock price for JPMorgan Chase & Co. The consumer price index Real GDI

The stock price for JPMorgan Chase & Co.

You eat M&Ms every day. When you go to the store to buy some, you find that M&Ms are more expensive than they were last month. Which of the following could explain why M&Ms are more expensive? Consumers are now purchasing fewer M&Ms compared to other types of chocolates. A new study finds that the benefits of eating chocolate are not as great as previously thought. A new robot has been installed at the Mars chocolate company that reduces the time needed to produce M&Ms by half. The supply of cacao beans, used to produce chocolate, has fallen around the world.

The supply of cacao beans, used to produce chocolate, has fallen around the world.

You're shopping online, and you place an item in your virtual cart. Two days later, you return to the virtual cart to check out and find that the item is now more expensive. Assuming that the market is competitive, what could explain the price increase? There is a shortage of the item. There is decreased demand for the item. There is a surplus of the item. New sellers are offering the same product.

There is a shortage of the item.

Dale is a stay-at-home-parent whose typical day consists 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 counted by assigning a value that is equivalent to what it would have taken to pay a housekeeper to perform the same tasks. They are counted by subtracting Dale's opportunity cost in terms of lost income. They are not counted. They are counted at market value.

They are counted at market value.

Why are supply curves typically upward-sloping? They slope upward because sellers prefer to sell more when prices are lower. They slope upward due to the law of demand. They slope upward because higher prices lead individual businesses to supply a larger quantity and more businesses are willing to supply goods and services. They slope upward because sellers demand more when prices are lower.

They slope upward because higher prices lead individual businesses to supply a larger quantity and more businesses are willing to supply goods and services.

Suppose that you have a pumpkin stall at a farmer's market, and the Halloween season arrives. You know that your customers will want to buy many pumpkins to decorate their houses and make pumpkin pies. Which of the following is a likely result of this scenario? You will be able to sell only the highest-quality pumpkins. You can charge a higher price per pumpkin. You will take fewer pumpkins to the market to sell. You will wind up with many unsold pumpkins.

You can charge a higher price per pumpkin.

Refer to the graph to answer the question. In the graph, the movement from point W to point P represents: a shift lef in demand a decrease in demand. an increase in quantity demanded. an increase in quantity demanded. an increase in demand.

a decrease in demand.

A normal good is: a good which is normally purchased by many consumers. a good which is only purchased by high-income consumers. a good for which higher income causes an increase in demand. a good for which higher income causes a decrease in demand.

a good for which higher income causes an increase in demand.

A seller at a farmer's market wants $10 for a bag of 10 apples. You think his price is too high, so you counter with an offer of $6 for the bag. The seller then offers you a much smaller bag of five apples for $6. You bargain again, and the seller lets you buy the 10 apples for $8. This scenario is an example of: a market in action. perfect competition. a centrally planned market. a shortage.

a market in action.

Quantity demanded is on the horizontal axis when you plot a demand curve and shows the: amount where opportunity cost is equal to the marginal benefit. amount of a good that a person is willing to buy at each price. amount of a good that a person actually buys at the market price. amount of a good that a seller is willing to sell at a particular price.

amount of a good that a person is willing to buy at each price.

Henry Ford's $5 per day wage is an example of: an efficiency wage. a government regulated wage. an equilibrium wage. a minimum wage law.

an efficiency wage.

A minimum wage that is above the equilibrium wage is: an unemployment benefit. a labor union negotiated wage. an example of a price floor. an efficiency wage.

an example of a price floor.

Refer to the graph to answer the question. The movement from point M to point N represents: a shift down the demand curve a decrease in quantity demanded. a decrease in demand. an increase in quantity demanded. an increase in demand.

an increase in quantity demanded.

Graphically, shortages will always occur: at prices below the equilibrium price. when the quantity supplied exceeds the quantity demanded. at prices above the equilibrium price. at the equilibrium price.

at prices below the equilibrium price.

Joshua Murphy is planning on studying late into the night for his economics exam. How many cups of coffee should he buy tonight? Joshua should keep buying coffee throughout the evening until the marginal: benefit of purchasing one more coffee equals the marginal cost. cost of purchasing one more coffee is positive. benefit of purchasing one more coffee is positive. benefit of purchasing one more coffee is less than the marginal cost.

benefit of purchasing one more coffee equals the marginal cost.

Kathleen Alvarado is binge-watching her favorite show on Netflix. She is attempting to decide how many more episodes to watch. Kathleen should continue watching episodes as long as the marginal: benefit of watching another episode is positive. benefit of watching another episode is less than the marginal cost. cost of watching another episode is positive. benefit of watching another episode exceeds the marginal cost.

benefit of watching another episode exceeds the marginal cost.

The key to using the cost-benefit principle is to think about _____ aspects of a decision. only financial both financial and nonfinancial neither financial nor nonfinancial only nonfinancial

both financial and nonfinancial

The cost-benefit principle states that _____ are the incentives that shape decisions. incomes framing effects opportunity costs costs and benefits

costs and benefits

The Great Moderation refers to the: longstanding effect of the Great Recession. stable level of inflation in the United States. decreased volatility of the U.S. economy. increase in globalization.

decreased volatility of the U.S. economy.

When there is a shortage of highly skilled workers in a particular region, the: demand for skills education increases. supply of jobs for highly skilled workers increases. demand for skills education decreases. demand for highly skilled workers increases.

demand for skills education increases.

According to the marginal principle, keep increasing quantity until the marginal benefit of an additional item is _____ the marginal cost of an additional item. greater than or less than greater than equal to less than

equal to

Hyperinflation is: inflation that occurs when the economy is in a recession. extremely high rates of inflation. a period of high money growth in an economy. very high rates of economic growth.

extremely high rates of inflation.

As a result of technological innovation, automated water pumps are being installed on the farms of Kenyan tomato farmers. As a result of the increased use of automated water pumps, the equilibrium price of tomatoes will: fall, due to a rise in supply. rise, due to a rise in demand. rise, due to a fall in supply. fall, due to a fall in demand.

fall, due to a rise in supply.

You are considering whether you should go out to dinner at a restaurant with your friend. The meal is expected to cost you $50, you typically leave a 20% tip, and a round-trip Uber ride will cost you $15. You value the restaurant meal at $30 and the time spent with your friend at $50. You should ____ to dinner with your friend because the benefit of doing so is _____ than the cost. not go; greater not go; less go; less go; greater

go; greater

Which of the following is a scaled number? the sum of all incomes earned in the economy the country's national debt government budget deficit as a percentage of GDP total tax revenues in the economy

government budget deficit as a percentage of GDP

The Rational Rule for Sellers says that a seller should sell one more unit of an item if the price is: less than the marginal cost. greater than or equal to the marginal benefit. greater than or equal to the marginal cost. less than the marginal benefit.

greater than or equal to the marginal cost.

The higher the minimum wage, as compared to the equilibrium wage, the: lower the natural rate of unemployment. lower the structural unemployment rate. higher the structural unemployment rate. higher the cyclical unemployment rate.

higher the structural unemployment rate.

When there is a shortage of highly skilled workers in a particular region: the incomes of highly skilled workers fall. there is a corresponding surplus of low-skilled workers in the region. unemployment rises among highly skilled workers. highly skilled workers can negotiate higher salaries.

highly skilled workers can negotiate higher salaries.

The interdependence principle: implies that buyers decisions are affected by many factors other than the price of an item. implies that consumers depend on each other to make purchase decisions in the market. refers to the marginal benefit of consuming additional units of an item. is the same as the cost-benefit principle.

implies that buyers decisions are affected by many factors other than the price of an item.

When you get hired for a well-paying job, you will most likely view older used cars as normal goods. complementary goods. substitute goods. inferior goods.

inferior goods.

The principle that your best choice depends on your other choices, the choices others make, developments in other markets, and expectations about the future is known as the _____ principle. marginal interdependence opportunity cost cost-benefit

interdependence

Diminishing marginal benefit: is when buying an additional item yields a smaller marginal benefit than the previous item. is not important in determining a consumer's purchase decision. is when buying an additional item yields a larger marginal benefit than the previous item. is when consumers do not follow the rational rule.

is when buying an additional item yields a smaller marginal benefit than the previous item.

Nerida Kyle could either commute to work via Uber or purchase a new car. The average cost of her one-way Uber trip is $15. Nerida works five days a week for 50 weeks a year. Based solely on avoiding the cost of an Uber, Nerida should purchase a car if the cost of the car is _____ than _____ per week. less; $75 greater; $150 less; $150 greater; $75

less; $150

The equilibrium unemployment rate is also known as the _____ unemployment rate. frictional structural cyclical long-run

long-run

Menu costs are the: total costs of producing goods and services. costs of producing restaurant meals. variety of costs that cause producers to change their prices. marginal costs of adjusting prices.

marginal costs of adjusting prices.

Which of the following lists the functions of money? medium of exchange, store of value, and unit of account carrier of exchange, unit of account, and measure of inflation medium of exchange, measure of inflation, and benchmark of quality store of value, store of interest, and buffer against inflation

medium of exchange, store of value, and unit of account

A market consists of ten similar suppliers that are making the same supply decisions. To find the market supply of these ten suppliers, you: take one-tenth of the individual supply of each supplier and add it up. find the average quantity produced by the ten suppliers. take the individual supply of one supplier. multiply the individual supply of one of the suppliers by ten.

multiply the individual supply of one of the suppliers by ten.

If you see that the consumer price index this year is lower than the consumer price index last year, this means that: the prices of each and every good and service went down. economic growth also decreased. the consumer price index is lower than the producer price index. on average, prices went down across the economy

on average, prices went down across the economy

The four stages of the business cycle are: consumption, investment, government expenditure, and net exports. expansion, growth, contraction, and depression. peak, recession, trough, and expansion. full employment, potential GDP, recessionary gap, and inflationary gap.

peak, recession, trough, and expansion.

The opportunity costs of attending college include the: cost of clothes to wear at school. effort and hard work. cost of room and board. potential income that could be earned working.

potential income that could be earned working.

When plotting a demand curve quantity demanded is on the vertical axis. price is on the horizontal axis. price is on the vertical axis. quantity supplied is on the vertical axis.

price is on the vertical axis.

The GDP deflator is an index that tracks the: average price that consumers pay over time for a representative basket of goods and services. highest prices consumers pay over time for imported goods and services. price of all goods and services produced domestically. price that businesses pay over time for the inputs used in the production process.

price of all goods and services produced domestically.

A shortage occurs when: there is excess production. quantity supplied exceeds quantity demanded. when there is insufficient demand. quantity demanded exceeds quantity supplied.

quantity demanded exceeds quantity supplied.

Suppose that an economy is in a recession. You would expect to see the unemployment rate: be zero. rise above the equilibrium unemployment rate. fall below the equilibrium unemployment rate. be equal to the equilibrium unemployment rate.

rise above the equilibrium unemployment rate.

Based on Okun's rule of thumb, if you forecast that the output gap will decline from 0% to -3%, the unemployment rate will: rise by 3%. fall by 2%. fall by 1.5%. rise by 1.5%

rise by 1.5%

According to Okun's rule of thumb, for every 1% fall in the actual output below potential output, the unemployment rate: falls by 1%. falls by 0.5%. rises by 1%. rises by 0.5%.

rises by 0.5%.

Use the figure to answer the question. Which of the following events would lead to a shift of the supply curve from Old supply to New supply? whole line moves right a natural disaster that causes a shutdown of production technological advance in production techniques increased taxation of raw materials used by producers a decrease in the size of the market

technological advance in production techniques

Money illusion is the: tendency to focus on nominal values instead of inflation-adjusted values. increase in the amount of money that it takes to purchase goods and services when prices rise. inability to understand that prices always rise. illusion that one's earnings this year are higher than they were last year.

tendency to focus on nominal values instead of inflation-adjusted values.

An individual demand curve is a graph: that plots the quantity of an item that a seller plans to sell, at each price. that plots the quantity of an item that someone plans to buy, at each price. that plots the quantity of an item that someone plans to buy, at one single price point. that plots the market price of a product at different points in time.

that plots the quantity of an item that someone plans to buy, at each price.

Paint and paintbrushes are complements. If the price of paint rises, we can expect: the quantity demanded of paint to increase. the demand for paintbrushes to decrease. the demand for paintbrushes to increase. the quantity demanded of paintbrushes to remain unchanged.

the demand for paintbrushes to decrease.

An economy's potential output level is: the level at which no resources are available in the economy. equivalent of the GDP at current market value. the output when unemployment is zero. the output that is possible when all resources are fully employed.

the output that is possible when all resources are fully employed.

A downward-sloping demand curve implies: there is a positive relationship between price and quantity demanded. there is no relationship between price and quantity demanded. there is an inverse relationship between price and quantity demanded. buyers are willing to buy less when prices are lower.

there is an inverse relationship between price and quantity demanded.

Which of the following is an example of transfer payments? military salaries unemployment benefits interest earned on savings in banks government loans

unemployment benefits

Variable costs are the costs that vary with the quantity of output produced. are incurred to build factories and assembly plants. are independent of the amount of output produced. stay fixed with the quantity of output produced.

vary with the quantity of output produced.

An equilibrium in a market occurs: when suppliers have sold all the goods and services that they have produced. when the quantity supplied equals the quantity demanded. at the halfway point on a demand curve. at the halfway point on the price axis.

when the quantity supplied equals the quantity demanded.

A coffee shop opens next to an existing coffee shop. Which of the following graphs shows the effect of this new coffee shop on the market supply curve for coffee in this area? Graph C Graph D Graph A Graph B

whole line moves to the right

The United Kingdom plans to end the use of gas-powered and diesel-powered cars by the year 2040. At the same time, car manufacturers, such as General Motors and Nissan, are increasing the number of electric car models they produce. Based on this information, which of the following statements is/are correct?(i) If the supply of new electric cars is greater than the demand for new electric cars, then the price of electric cars will fall in the future.(ii) The demand for gasoline will fall in the future.(iii) The demand for electricity will rise in the future.(iv) The demand for diesel will rise in the future. (i) and (ii) only (i) (i), (ii), and (iii) (ii) and (iv)

(i), (ii), and (iii)

In order to be considered unemployed, a person must:(i) be part of the working-age population.(ii) be actively looking for work.(iii) not have been self-employed.(iv) must be noninstitutionalized. (ii) and (iv) (i) and (ii) (iii) and (iv) (i), (ii), and (iv)

(i), (ii), and (iv)

Which of the following are correct about fixed costs?(i) They do not change with the level of production in the short run.(ii) They include variable costs.(iii) They are present even when the firm is producing zero units.(iv) They are irrelevant to marginal cost. (i), (iii), and (iv) (i), (ii), and (iii) (ii) and (iv) (i), (ii), (iii), and (iv)

(i), (iii), and (iv)

Which of the following is (are) included in investment?(i) military spending(ii) the purchase of an aircraft by a domestic airline(iii) the purchase of $45,000 worth of bonds(iv) the purchase of $32,000 worth of stock(v) social security payments(vi) the construction of a highway by the federal government (i), (ii), (v), and (vi) (ii), (iii), and (iv) (ii) only (i) and (vi)

(ii) only

In the graph, the movement from point J to point K must have been caused by: up on same line a rise in the price of the item. a fall in the price of the item. an increase in the total supply of the item. a decrease in the total supply of the item.

a fall in the price of the item.

During the Great Recession, the United States Congress increased the length of time that unemployment benefits could be received from 52 weeks to 99 weeks. This change caused: an increase in the costs for the government. an increase in the labor force participation rate. a decrease in unemployment. an increase in the number of employed people in the economy.

an increase in the costs for the government.

In a voluntary economic transaction between a buyer and a seller, _____ can earn economic surplus from the transaction. only the buyer only the seller neither the buyer nor the seller both the buyer and the seller

both the buyer and the seller

Jonathan Mendez is deciding whether to study for his economics exam at a café down the street or go to a concert a few cities over. The time spent commuting to the concert is ____ in his opportunity cost calculations and represents a _____ cost. not included; financial included; financial not included; sunk included; nonfinancial

included; nonfinancial

A rational buyer will: not consider costs versus benefits when purchasing a product. keep buying a product until marginal benefit equals price. buy the product only when the marginal benefit of consuming the product is twice as much as the price of the product. buy a product until the marginal benefit of consuming the product is less than the price of th

keep buying a product until marginal benefit equals price.

The real interest rate is the: percentage of the nominal interest that is inflation. nominal interest rate plus the rate of inflation. nominal interest rate minus the rate of inflation. economic growth rate adjusted for the effects of inflation.

nominal interest rate minus the rate of inflation.

You purchase a certificate of deposit and expect an inflation rate of 1.25% over the next year. Your nominal rate of interest is 2.1%. What is your expected real rate of return? 1.25% 0.85% -2.1% -0.85%

0.85%

Which of the following correctly shows the steps needed to calculate the inflation rate? Find the total value of the basket of goods and services, assess quality changes from one period to the next, and measure the inflation rate. Find out what people typically buy, collect the prices from the stores where people shop, tally up the cost of the basket of goods and services, and calculate the inflation rate. Tally up the cost of the basket of goods and services, subtract the value of goods and services that are no longer counted in the basket, and then calculate the inflation rate. Collect prices from the stores where people shop, assess the substitution that people make from low inflation to high inflation products, and calculate the difference in the prices that people pa

Find out what people typically buy, collect the prices from the stores where people shop, tally up the cost of the basket of goods and services, and calculate the inflation rate.

Which of the following correctly describes the business cycle? It is the constant rise in GDP over time. It is the fluctuations of GDP around the potential output. It refers to excess unemployment during recessionary periods. It refers to ups and downs in business revenue during expansions and recessions.

It is the fluctuations of GDP around the potential output.

The __________ suggests, decisions about quantities are best made incrementally. interdependence principle opportunity cost principle marginal principle cost-benefit principle

marginal principle

If you see that inflation between last year and this year is 3%, this means that: the prices of each and every good and service went up by 3%. the consumer price index rose by 3% more than the producer price index. economic growth is also 3%. on average, prices went up across the economy by 3%.

on average, prices went up across the economy by 3%.

When you calculate marginal costs, they should include: only fixed costs. both the variable and fixed costs. the market price of the product. only variable costs.

only variable costs.

Decisions should reflect the _____ costs, rather than just the _____ costs. financial; marginal nonfinancial; financial opportunity; financial opportunity; nonfinancial

opportunity; financial

If a store runs a sale on a product to clear out its stock, we can conclude that: the demand for the product is larger than the supply of the product. the product must be very close to its expiration date. there was a surplus of the product in the store. there was a shortage of the product in the store.

there was a surplus of the product in the store.

Diana is a student studying economics and currently working on her class schedule for next semester. She decides to enroll in a course on economic data analysis because she knows that data analysis is a highly sought-after skill from employers in her career field. Weighing what may affect her in the future opportunities demonstrated dependency: between people or businesses in the same market. between markets. through time. between college courses.

through time.

An underemployed person is one who is: employed in the underground economy. retired or outside of the labor force. cyclically unemployed. working but whose skills are not fully utilized.

working but whose skills are not fully utilized.

Dependencies between your own choices reflect the fact that: resources are spread across varying markets. society has limited resources. resources can be spread across time. you have limited resources.

you have limited resources.

Which of the following is an example of a durable good? a soft drink your new car fresh flowers from the florist your haircut

your new car