Macro Final

suppose working age pop...

(20/100)x100

what is the real gdp in 2018 using 2013 as the base year

10275

which of the following goods is directly counted in gdp

12-inch subway sandwich purchased by a student

Assume the market basket for the consumer price index has two products-meat and potatoes

129

if nominal rate of interest is 6.5 and the inflation rate is 3% what is teh real rate of interes?

3.5%

you lend 5000 to a friend for one year...

4.4%

If real GDP per capita doubles between 2005 and 2020, what is the average annual growth rate of real GDP per capita?

4.7%

gdp deflator in year 2 is 105, using year 1 as the base year. this means tha on average, the cost of goods and services is

5% higher in year 2 than in year 1

if cpi in 1990 was 131 and cpi in 2010 was 218...

66525

imagine that you borrow 5000 for one year and at the end of the year you repay the 5000 the interest...

8%

If the number employed is 190 million, the number unemployed is 10 million, and the working-age population is 250 million, then the labor force participation rate is

80%

suppose that a simple economy produces only 4 goods and services: sweatshirts, dental examinations, coffee, drinks, and coffee beans. assume coffee beans are used in the production of the coffee drinks. use information in the above table, nominal gdp for this simple economy equals

8750

if # of unemployed workers is 19 million, # of working age pop is 500 million and unemployment rate is 4%, what is the labor force participation rate?

95%

Hurricane Katrina...

shortage of gasoline

If labor productivity growth slows down in a country, this will

slow down the increase in real gdp per capita

cyclical unemployment is the result of

slowdown in the economy

which of the following is a consequence of min wage laws

some employers will be reluctant to hire as many workers as they would without min wage

A farm worker gets paid today in money, but plans to spend the money next week. This illustrates which function of money?

store of value

If whole tomatoes were money, which of the following functions of money would be the hardest for tomatoes to satisfy?

store of value

2017 Boeing...

structurally unemployed

A lumberjack loses his job because timber cutting restrictions were imposed by the EPA to protect the spotted owl habitat. This lumberjack would be

structurally unemployed

if demand for letters...

supply of booth letters would have to be less than the supply of lincoln letters

stagflation usually results from

supply shock

which of the following is consistent with the graph depicted above

tech change increases the profitability of new investment

frictional unemployment is the result of

the process of matching workers with jobs

gdp is calculated by summing up

the total market value of final goods and services produced in the economy during a period of time

if prices in the economy rise,

then purchasing power of a dollar declines

which of the following best describes the wealth effect?

when price level falls, real value of household wealth rises

transfer payment is a payment by the gov to an individual for

which gov doesn't receive a good or service in return

Why does the short-run aggregate supply curve shift to the right in the long run, following a decrease in aggregate demand?

workers and firms adjust their expectations of wages and prices downward and they accept lower wages and prices

Why does the short-run aggregate supply curve shift to the left in the long run, following a increase in aggregate demand?

workers and firms and adjust their expectations of wages and prices upward and they push for higher wages and prices

if net taxes fall by 80 billion we would expect household saving to rise by less than 80 billion

household saving to rise by less than 80 billion

In market economy, ___ interact in markets to decide the answers to the fundamental economic questions

households and firms

Who receives the goods and services produced in the United States depends largely on

how income is distributed

when price level in US falls relative to price level of other countries, ____ will fall, ____ will rise, and ___ will rise

imports, exports, net exports

which of the following describes the difference btw scarcity and shortage

in economic sense, almost everything is scarce. a shortage of a good or service occurs when the quantity demanded is greater than the quantity supplied at the current market price

which of the following would cause both the equilibrium price and equilibrium quantity of barley (assume that barley is an inferior good) to increase

increase in consumer income

which of the following is consistent with the graph depicted?

increase in proportion of income after next taxes used for consumption

during a bus cycle expansion, total production ___ and total employment ___

increase, increase

As the economy nears the end of a recession, which of the following do we typically see?

increased spending on capital goods by firms

as job opportunities for women and the wages those jobs pay have increased, opportunity cost of doing housework has ___, so many families have chosen to hire specialists in household chores, such as cleaning services and lawn care services, bc cost of these specialists is ___ than cost of wife (or husband) performing those chores

increased, lower

in dynamic AD and AS model, if AD shifts further than AS

inflation occurs

which of the following is not directly counted in gdp

intermediate goods

which of the following would shift a nation's production possibilities frontier inward?

a law requiring workers to retire at age 50

which of the following is true about the consumer price index?

it assumes that consumers purchase the same amount of each product in the market basket each month

which of the following is not an assumption made by the dynamic model of aggregate demand and aggregate supply

aggregate demand and potential real GDP decrease continously

nominal gdp of the US in 2016 was approx 18.6 million this means

all of the above are true

if you can produce more of something than others with the same resources, you have

an absolute advantage

an outward shift of a nation's production possibilities frontier can occur due to

an increase in the labor force

which one of these statements is not one of the 3 key economic ideas/assumptions?

markets are the most efficient organizations structure

a successful market economy requires defined property rights and

an independent court system to adjudicate disputes based on the law

The process of an economy adjusting from a recession back to potential GDP in the long run without any government intervention is known as

automatic mechanism

which of the following contributes to the efficiency of markets?

markets promote competition and voluntary exchange

which of the following policies would reduce frictional unemployment

building an online job database that helps workers find jobs

the production possibilities frontier shows

max attainable combinations of 2 products that may be produced in a particular

When a grocery store accepts your $5 bill in exchange for bread and milk, the $5 bill serves as a

medium of exchange

Rising prices erode the value of money as a ________ and as a ________.

medium of exchange; store of value

which of the following would cause equilibrium price of apple juice to decrease and the equilibrium quantity of apple juice to increase

decrease in price of apples

which of the following statements is true?

decrease in supply causes the equilibrium price to rise; the increase in price then results in a decrease in quantity demanded

monetary poly refers to actions fed reserve takes to manage

money supply and interest rates to pursue its economic objectives

If firms pay what are called "efficiency wages," they pay wages that

motivate workers to increase their productivity

to affect the market outcome, a price floor

must be set above the equilibrium price

in order to be binding, a price floor

must lie above the free market equilibrium price

Someone who is available for work but has not actively looked for work in the previous four weeks would be classified as

not in labor force

last week, 6 kronor could purchase one US dollar

decrease, decrease

government proposes a tax on halogen light bulbs. sellers will bear the entire burden of the tax if the

demand curve is horizontal

which of the following cause the unemployment rate as measured by the Bureau of Labor Statistics to understate the true extent of joblessness?

discouraged workers

By making exchange ________, money allows for ________ and higher ________.

easier, specialization, productivity

primary purpose of patents and copyrights is to

encourage the expenditure of funds on research and development to create new products

suppose you lend 1000 at an interest rate of 10%...

equal to 0%

one of the 3 primary tools the Fed reserve uses to conduct monetary policy, tool used most often is

open market operations

the concept of ____ is that the economic cost of using a factor of production is the alternative use of that factor that is given up

opportunity cost

Jack just told his boss that he thinks his boss is an idiot. It is likely that Jack will be experiencing ________ unemployment in the near future.

frictional

structural unemployment is the result of

persistent mismatch btw skills and characteristics of worker sand requirements of jobs

the recession of 2007-2009 would most likely be represented in a production possibilities frontier graph by

point inside the frontier

fed reserve system's 4 monetary policy goals are

price stability, high employment, economic growth, and stability of financial markets and institutions

if real gdp in 2018 (2009 prices) is greater than real gdp in 2017 and nominal gdp in 2018 is lower than nominal gdp of 2017 then

prices in 2018 are lower than prices in 2017

Specializing in the production of a good or service in which one has a comparative advantage enables to do which of the following

produce a combination of goods that lies outside of its own production possibilities frontier

which of the following would not be included in the expenditure category called investment expenditures

purchase of shares of preferred stock

at market equilibrium

quantity demanded equals quantity supplied

a good measure of the standard of living

real gdp per capita

If your nominal wage rises faster than the price level, we can say your real wage has ________ and the purchasing power of your income has ________.

risen, risen

When the price of oil rises unexpectedly, the equilibrium price level ________ and the unemployment rate ________ in the short run.

rises, rises

which of the following are not considered part of gov purchases?

welfare benefits

to increase money supply fed reserve could

conduct an open market purchase of treasury securities

which of the following statements demonstrates that economic agents respond to incentives?

consumers rent more kayaks from a vendor that rents kayaks at a lower price than other rival kayak vendors along Waikiki beach. Department stores take steps to increase security since they believe it is more costly to allow shoplifting than to install expensive security monitoring equipment.

if the price level rose in 3 consecutive years from 100 to 120 to 140, then the annual inflation rate over those years would

decrease

which of the following would cause both the equilibrium price and equilibrium quantity of oysters (assume that oysters are a normal good) to decrease?

decrease in consumer income

a decrease in demand for eggs due to changes iin consumer tastes, accompanied by a decrease in the supply of eggs as a result of an outbreak of avian flu, will result in

decrease in equilibrium quantity of eggs; equilibrium price may increase or decrease

which of the following indicates that the US economy has become more stable since 1950?

less sever fluctuations in real gdp

your grandfather tells you that he earned 7000/year

less than 5 times as much as your grandfather in terms of real income

key idea of aggregate expenditure model is that in any particular year, the level of gdp is determined mainly by

level of aggregate expenditure

___ of unemployment during ___ make it easier for workers to ___ wages

low levels; expansion; negotiate higher

which of the following best describes an assumption that economists make about human behavior?

they assume that rational behavior is useful in explaining choices people make even people may not behave rationally all the time

which of the following statements is false

trade-offs don't apply when the consumers purchase a product for which there is excess supply, such as a stock clearance sale

according to the text, economists consider full employment to occur when the

unemployment rate consists of only frictional and structural unemployjment

Mike has been unemployed for over a year. He hasn't looked for a job in the last three months, but he's just started looking for work again. Because Mike started looking for a new job,

unemployment rate has increased

statement "dell laptop costs 1200 illustrates which function of money

unit of account

scaracity refers to the situation in which

unlimited wants exceed limited resources

Suppose in 2018, you purchase a house built in 2003. Which of the following would be included in the GDP for 2018?

value of services of real estate agent