macro final part 1

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. The total flow of funds into and out of financial markets is: A) $70. B) $110. C) $170. D) $300.

D 300

The rule of 70 states that a variable's approximate doubling time equals: A) 70 times the growth rate. B) the growth rate divided by 70. C) 70 divided by the doubling time. D) 70 divided by the growth rate.

D 70 divided by growth rate

(Scenario: Productivity) Look at the scenario Productivity. How much has technological progress contributed as a percentage of productivity growth? A) 20% B) 47% C) 53% D) 91%

D 91%

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. What is the value of net exports? A) -$20 B) $20 C) $50 D) $130

A -20

(Scenario: Productivity) Look at the scenario Productivity. How much has technological progress contributed to productivity growth? A) 1.4% B) 1.6% C) 2% D) 3%

A 1.4%

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. The total flow of funds into and out of households is: A) $1,020. B) $1,000. C) $850. D) $700.

A 1020

Boeing buys $3 million worth of steel, $2.5 million worth of computer hardware and software, and $1 million worth of mechanical tools to manufacture a certain model of aircraft. Boeing sells this particular model at $10 million. The value added by Boeing is equal to: A) $3.5 million. B) $16.5 million. C) $13 million. D) $15.5 million.

A 3.5 million

(Scenario: The Aggregate Production Function) Look at the scenario The Aggregate Production Function. If K / L = $81, then real GDP per worker is: A) $4,050. B) $4,000. C) $4,096. D) $40,500.

A 4050

(Table: The Consumer Price Index) Look at the table The Consumer Price Index. The approximate rate of inflation in year 3 is: A) 5%. B) 10%. C) 19%. D) 20%.

A 5%

(Table: Population Data for Estill County) Look at the table Population Data for Estill County. How many people are in the labor force? A) 6,000 B) 9,400 C) 7,400 D) 6,500

A 6000

(Table: Population Data for Estill County) Look at the table Population Data for Estill County. What is the labor force participation rate? A) 64% B) 81% C) 17% D) 79%

A 64%

(Scenario: Real GDP) Look at the scenario Real GDP. The value of nominal GDP in years 1 and 2 respectively is: A) $900 and $1,077.50. B) $900 and $990. C) $180,000 and $257,400. D) $1,000 and $1,005.

A 900 and 1077.50

(Table: GDP) GDP in the table is: A) $94 billion. B) $188 billion. C) $168 billion. D) $139 billion.

A 94 billion

Physical capital includes: A) a worker's education or knowledge. B) machine tools. C) money. D) shares of stock.

B machine tools

(Figure: The Effect of a Minimum Wage) Look at the figure The Effect of a Minimum Wage. Suppose the labor market is in equilibrium at E when the government imposes a minimum wage of WF. Structural unemployment will equal: A) QS - QD. B) QE - QD. C) QS - QE. D) zero.

A QS - QD

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. If there is an increase in physical capital per worker (all other factors remaining unchanged), it is best indicated by a move from: A) A to B. B) B to A. C) C to B. D) B to C.

A a to b

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. Which of the following changes in real GDP is most likely to have resulted from an increase in domestic savings? A) A to B B) B to A C) C to B D) C to A

A a to b

People who are changing jobs are counted in _____ unemployment. A) frictional B) involuntary C) structural D) cyclical

A frictional

Unemployment that is due to the time workers spend in job search is _____ unemployment. A) frictional B) structural C) cyclical D) natural

A frictional

Productivity is equal to: A) real GDP divided by the number of workers. B) real GDP divided by the population. C) the number of workers per machine. D) the total output produced.

A real gdp divided by the number of workers

Technological progress is advanced through: A) research and development. B) government regulation. C) consumption. D) infrastructure.

A research and development

Structural unemployment: A) results when there are more job hunters than jobs. B) affects those entering the labor force for the first time. C) is zero when the economy is in full employment. D) is caused by short-run economic fluctuations.

A results that are more job hunters than jobs

Last month Brent lost his job at the auto parts factory because the factory relocated to Asia. Brent has been looking for similar jobs in his town but has found no openings. Brent is best classified as: A) structurally unemployed. B) frictionally unemployed. C) a discouraged worker. D) out of the labor force.

A structurally unemployed

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. How does the government finance its spending? A) taxes of $150 plus borrowing of $70 B) foreign borrowing and sales of stock of $110 C) investment spending of $120 D) net exports of $80

A taxes of 150 plus borrowing of 70

(Table: Calculating GDP) According to the information in the table Calculating GDP, what is GDP? A) $47,475 B) $12,200 C) $21,485 D) $34,085

B 12200

(Table: Kenya's Economy in 2010) Look at the table Kenya's Economy in 2010. During 2010, assuming no changes in the price level, aggregate output per capita in Kenya grew at a rate of: A) 0.6%. B) 2.6%. C) 5.2%. D) 7.8%.

B 2.6

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. How much is total government spending? A) $20 B) $220 C) $370 D) $200

B 220

(Table: Kenya's Economy in 2010) Look at the table Kenya's Economy in 2010. Aggregate output at the end of 2010, assuming no changes in the price level, was about: A) $326 billion. B) $32.632 billion. C) $3,635 billion. D) $6,500 billion.

B 32.632 billion

(Scenario: Productivity) Look at the scenario Productivity. How fast has physical capital per worker grown? A) 5% B) 4% C) 3% D) 2%

B 4%

(Table: Kenya's Economy in 2010) Look at the table Kenya's Economy in 2010. The population at the end of 2010 was about: A) 400 million. B) 41 million. C) 14 million. D) 401 million.

B 41 million

(Scenario: Productivity) Look at the scenario Productivity. How much has growing physical capital per worker contributed as a percentage of total productivity growth? A) 80% B) 53% C) 30% D) 9%

B 53%

(Scenario: The Aggregate Production Function) Look at the scenario The Aggregate Production Function. If real GDP per worker equals $3,200, physical capital per worker equals: A) $81. B) $64. C) $49. D) $100.

B 64

(Table: Population Data for Estill County) Look at the table Population Data for Estill County. If marginally attached workers are included, the labor force in Estill County is: A) 7,400. B) 6,500. C) 6,000. D) 5,500.

B 6500

(Scenario: Real GDP) Look at the scenario Real GDP. Using year 1 as the base year, the growth rate of real GDP from year 1 to year 2 is: A) 10%. B) 7.8%. C) 19.7%. D) 8.8%.

B 7.8%

(Scenario: Real GDP) Look at the scenario Real GDP. Using year 1 as the base year, real GDP in year 2 is: A) $900. B) $970. C) $1,000. D) $1,077.50.

B 970

The Arcadia Entertainment Co. produced 20,000 DVDs of the movie Thor in 2011. Only 4,000 copies remained unsold at the end of 2011. As a result: A) only 16,000 DVDs should be included in GDP in 2011 as consumption expenditure. B) all 20,000 DVDs will be included in GDP in 2011, 16,000 as consumption expenditure and 4,000 as investment expenditure C) only 16,000 DVDs are included in GDP of 2011; the remaining 4,000 are counted in GDP of 2012. D) all 20,000 DVDs are initially counted in 2011 GDP as consumption expenditure, but they will be subtracted and added to 2012 GDP as the merchandise gets sold.

B all 20,000 DVDs will be included in GDP in 2011, 16,000 as consumption expenditure and 4,000 as investment expenditure

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. Which of the following changes in real GDP is most likely to have resulted from an increase in the quality (as well as quantity) of public health measures? A) A to B B) B to C C) B to A D) C to B

B b to c

(Figure: The Effect of a Minimum Wage) Look at the figure The Effect of a Minimum Wage. Suppose that after some time with a minimum wage of WF, the government abolishes the minimum wage. Employment will: A) decrease to QE. B) increase to QE. C) stay at QE. D) be impossible to determine.

B increase to QE

An example of an intermediate good is: A) wages paid to an employee. B) steel purchased by aircraft manufacturers. C) vegetables purchased for your dinner. D) electric bills for the office.

B steel purchased by aircraft manufacturers.

Jim has a part-time job and would prefer to have a full-time job but has been unable to find one. Jim is classified as: A) a discouraged worker. B) underemployed. C) unemployed. D) out of the labor force.

B underemployed

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. What is GDP? A) $200 B) $700 C) $1,000 D) $1,080

C 1000

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. The total flow of funds into and out of the rest of the world is: A) $30. B) $80. C) $160. D) $240.

C 160

(Table: Population Data for Estill County) Look at the table Population Data for Estill County. What is the unemployment rate? A) 64% B) 48% C) 17% D) 6%

C 17%

(Scenario: Real GDP) Look at the scenario Real GDP. The growth rate of nominal GDP from year 1 to year 2 is: A) 10%. B) 7.8%. C) 19.7%. D) 8.8%.

C 19.7%

(Table: Population Data for Estill County) Look at the table Population Data for Estill County. If marginally attached workers are included in the labor force and in the unemployment rate, the unemployment rate in this economy is: A) 10.6%. B) 15.4%. C) 23.1%. D) 33.2%.

C 23.1%

(Scenario: Productivity) Look at the scenario Productivity. What is the growth rate of productivity? A) 5% B) 4% C) 3% D) 1.6%

C 3%

In 2011, consumption spending is $7,000, government purchases of goods and services is $2,000, and investment spending is $1,500. If GDP for 2011 is $10,300, exports are _____ and imports are _____. A) $400; $200 B) $100; $200 C) $600; $800 D) $500; $300

C 600, 800

(Table: Kenya's Economy in 2010) Look at the table Kenya's Economy in 2010. Aggregate output per capita at the beginning of 2010 was: A) $5,000. B) $10,000. C) $775. D) $7,750.

C 775

(Table: Kenya's Economy in 2010) Look at the table Kenya's Economy in 2010. Aggregate output per capita at the end of 2010, assuming no changes in the price level, was: A) $7,000. B) $7,005. C) $795. D) $7,490.

C 795

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. What is the value of disposable income? A) $1,020 B) $1,000 C) $870 D) $850

C 870

Donna was laid off at the beginning of 2011. She looked for a job for three months but could not find anything suitable. She then decided to volunteer for a soup kitchen and stopped looking for a job. Donna is considered to be: A) unemployed. B) underemployed. C) a discouraged worker. D) a part-time worker.

C a discouraged worker

Figure: Productivity) Look at the figure Productivity. An increase in physical capital per worker with everything else remaining unchanged is shown on the diagram as a movement from: A) B to C. B) A to C. C) A to B. D) B to A.

C a to b

(Figure: Productivity) Look at the figure Productivity. An improvement in technology with everything else remaining unchanged is shown on the diagram as a movement from: A) B to A. B) A to B. C) B to C. D) A to C.

C b to c

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. Which of the following changes in real GDP is most likely to have resulted from an increase in the quality (as well as quantity) of government spending on education? A) A to B B) B to A C) B to C D) C to B

C b to c

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. Which of the following changes in real GDP is most likely to have resulted from a gradual decline in property rights because of excessive government intervention? A) A to B B) B to C C) C to B D) C to A

C c to b

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. The government has a budget: A) surplus of $150. B) surplus of $220. C) deficit of $70. D) deficit of $200.

C deficit of 70

Ron quit his job in retail management and moved to Florida with his wife, a physician who opened a new practice there. He was not successful in his job search for the next four months. Ron's unemployment is: A) structural. B) cyclical. C) frictional. D) seasonal.

C frictional

(Figure: The Effect of a Minimum Wage) Look at the figure The Effect of a Minimum Wage. Suppose the labor market is in equilibrium at E when the government imposes a minimum wage of WF. The quantity of labor supplied may_____,resulting in structural unemployment. A) decrease to QD B) stay at QE C) increase to QS D) stay at WE

C increase to QS

Cyclical unemployment is the result of: A) normal job turnover (job searches). B) discrimination. C) the business cycle. D) the minimum wage.

C the business cycle

(Scenario: Productivity) Look at the scenario Productivity. How much has growing physical capital per worker contributed to productivity growth? A) 6% B) 5.4% C) 2% D) 1.6%

D 1.6%

(Table: The Consumer Price Index) Look at the table The Consumer Price Index. The approximate rate of inflation in year 5 is: A) 25%. B) 10%. C) 19%. D) 20%.

D 20%

(Table: The Consumer Price Index) Look at the table The Consumer Price Index. The approximate rate of inflation in year 2 is: A) 10%. B) 19%. C) 20%. D) 25%.

D 25%

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. Which of the following changes in real GDP is most likely to have resulted from the deterioration of the nation's infrastructure over time? A) A to B B) B to C C) C to B D) B to A

D b to a

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. If there is a significant increase in human capital per worker (all other factors remaining unchanged), it is best indicated by a move from: A) A to B. B) B to A. C) C to B. D) B to C.

D b to c

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. If there is significant technological progress (all other factors remaining unchanged), it is best indicated by a move from: A) A to B. B) B to A. C) C to B. D) B to C.

D b to c

(Figure: Technological Progress and Productivity Growth) Look at the figure Technological Progress and Productivity Growth. Which of the following changes in real GDP is most likely to have resulted from an increase in foreign investment spending? A) A to B B) B to C C) B to A D) both A to B and B to C

D both a to b and b to c

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. Which of the following is NOT a sector of the economy shown in the circular-flow model? A) households B) firms C) the rest of the world D) factor markets

D factor markets

(Figure: Expanded Circular-Flow Model) Look at the figure Expanded Circular-Flow Model. Which of the following is a type of market? A) household B) rest of the world C) government D) financial

D financial

Long-run economic growth is: A) higher in countries with a weak rule of law and excessive government intervention. B) lower in countries with a strong government and independent judiciary. C) lower in countries whose courts enforce property rights and whose government protects its citizens. D) higher in countries with a strong rule of law and political stability.

D higher in countries with a strong rule of law and political stability.

Natural resources are: A) more important determinants of productivity today than ever before. B) the reason behind the fast development of countries like Japan. C) the reason behind the slow development of countries like Nigeria. D) less reliable indicators of productivity today than they were a century ago.

D less reliable indicators of productivity today than they were a century ago.

The formula for the rule of 70, where n is number of years and r is growth rate, is expressed as: A) n × 70 = r. B) n / r = 70. C) r / n = 70. D) n × r = 70.

D n × r = 70.

An example of the frictionally unemployed is a(n): A) autoworker who is temporarily laid off because of a decline in sales. B) geologist who is permanently laid off from an oil company because of a technological advance. C) worker at a fast-food restaurant who quits work and attends college. D) real estate agent who leaves a job in Texas and searches for a similar higher-paying job in California.

D real estate agent who leaves a job in Texas and searches for a similar higher-paying job in California.

Sam, who is 55 years old and has been a steelworker for 30 years, is unemployed because the steel plant in his town closed and moved to Mexico. Sam is _____ unemployed. A) cyclically B) permanently C) frictionally D) structurally

D structurally

The value of all of the following goods EXCEPT _____ is included in the calculation of aggregate output. A) Firestone tires sold at your local garage B) a new shower installed in a 1920s house C) the six-CD player replacing the factory-mounted radio-cassette player in your car D) the tires on brand-new Volvo station wagons

D the tires on brand-new Volvo station wagons

Which of the following would NOT be included in this year's GDP? A) the production of a television show B) the purchase of a new work truck C) the hiring of a new police officer D) your purchase of your neighbor's 2001 Toyota

D your purchase of your neighbors 2001 toyota

GDP formula?

GDP = C + I + G + (X - M) aka consumer spending + investments by businesses + government spending + (exports - imports)