macro

David earned a salary of $43,500 in 1994 and $89,000 in 2010. The consumer price index was 148.2 in 1994 and 215.3 in 2010. David's 1994 salary in 2010 dollars is

$63,195.34 (43,500/148.2)*215.3

Michigan Cranberry Company sold $10 million worth of cranberries it produced. In producing cranberries, it purchased $1 million dollars' worth of supplies from foreign countries and paid workers who reside in Canada but commute to the U.S. $1 million. How much did these transactions add to U.S. GDP?

$9 million

Suppose that some country had an adult population of about 25 million, a labor force participation rate of 60%, and an unemployment rate of 6%. How many people were unemployed?

0.9 million

Suppose that the adult population in the town of Springfield is 225 million. If 40 million are unemployed and 100 million are employed, then the unemployment rate is approximately

29%

GDP is defined as the

Value of all final goods and services produced within, a country in a given period of time

Net exports equal

Y-(C+I+G).

Which of the following is a way to compute GDP?

add up the market value of all final goods and services

When economists talk about growth in the economy, they measure that growth as the:

percentage change in real GDP from one period to another.

Nominal GDP will definitely increase when

prices increase and output increases.

If the wage is kept above the equilibrium wage for any reason, the result is

structural unemployment

In the economy of TAMIU in 2015, exports were $200, GDP was $2000, government purchases were $200, imports were $270, and investment was $500. What was TAMIU's consumption in 2015?

$1370 =2000-200-200-500+270

In 1986, Ken bought a Ford Mustang for $8,000. If the price index was 122 in 1986 and the price index was 280 in 2011, then what is the price of the Mustang in 2011 dollars?

$18,360.66

In an imaginary economy, consumers buy only sandwiches and magazines. The fixed basket consists of 20 sandwiches and 30 magazines. In 2006, a sandwich cost $4 and a magazine cost $2. In 2007, a sandwich cost $5. The base year is 2006. If the consumer price index in 2007 was 125, then how much did a magazine cost in 2007?

$2.50

If in some year nominal GDP was $20 billion and the GDP deflator was 50, what was real GDP?

$40 billion.

The adult population in the town of Belleville is 150 thousand. If 100 thousand people are employed and 20 thousand are unemployed, then the labor force participation rate is approximately

80% =100000/20000

Which of the following transactions would add to the value of the U.S. GDP?

A grocery store purchases new freezers made in the United States.

A firm may pay its workers efficiency wages in an attempt to

All of the above are correct.

GDP does not reflect:

All of the above are correct.

The natural unemployment rate includes

Both frictional and structural unemployment.

To be counted as "employed" in the U.S. labor force statistics, a person

Does not have to be working for pay if they are working for a family business and does not have to be working full time.

People who are unemployed because they are in search of a job that suits their skills are included within

Frictional unemployment

Which of the following is not an explanation for the existence of structural unemployment?

Job search

Martin, a US citizen, travels to Mexico and buys a newly manufactured motorcycle there. His purchase is included in:

Mexican GDP, but not in US GDP.

Who of the following would be included in the Bureau of Labor Statistics' "unemployed" category?

Miguel, who is on temporary layoff

The consumer price index is used to:

Monitor changes in the cost of living over time.

If real GDP doubles and the GDP deflator doubles, then nominal GDP

Quadruples.

One problem with the consumer price index stems from the fact that, over time, consumers ten to buy larger quantities of goods that have become relatively less expensive and smaller quantities of goods that have become relatively more expensive. This problem is called:

Substitution bias.

Which of the following is not correct?

The consumer price index is used to measure the quantity of goods and services that the economy is producing.

The term inflation is used to describe a situation in which

The overall level of prices in the economy is increasing.

Which of the following is included in Singapore's GDP?

The value of production by an American working in Singapore.

Unemployment data are collected

Through a regular survey of about 60,000 households.

A form of government spending that is not made in exchange for a currently produced good or service is called

Transfer payment

Eric was laid off two months ago. He has not searched for other work because he is expecting to be recalled to work. The Bureau of Labor Statistics counts Eric as

unemployed and in the labor force