MacroEcon 1chp6

What is real GDP in 2014 if nominal GDP in 2014 is $15,000 billion, the GDP deflator in 2014 is 110, and the GDP deflator in 2010 was 100?

$13,636 billion

Rocky Gap Furniture employs 10 workers working eight hours each to produce 100 rocking chairs. What is the productivity of these workers?

1.25 chairs per hour

If the growth rate in an economy is 3.5%, then its GDP will double in about:

20 years

If an economy's GDP will double in 15 years, then its growth rate must be about

4.7%.

When Mr. Wilson worked full time, he paid a cleaning service to have his house cleaned twice a month. Now that he is retired, Mr. Wilson does his own cleaning. What is the effect on GDP?

GDP falls as a result of this change

If in the past you have always painted your own house but now you hire a painting contractor to do the work, what is the effect on GDP?

GDP rises as a result of this change

Most economists agree that ______ unemployment is the area in which public policymakers can have their greatest impact.

cyclical

Decreasing the accessibility to college in order to funnel workers into the workforce faster will:

decrease productivity of the economy.

From 1999 to 2002, the Japanese inflation rates were, respectively, -0.3%, -0.6%, - 0.7%, and -0.7%. During this time, the Japanese economy underwent:

deflation.

Which of the following terms describes a situation in which there is a reduction in the rate of inflation from 4% to 3% per year?

disinflation

In the United States, people are considered UNEMPLOYED if and when they

do not have a job but are available for work and have been actively seeking work

Lexie works Monday to Friday from 4 P.M. to 6 P.M. in the after-school program at a local elementary school. She began looking for a full-time job last week and has already scheduled three job interviews. According to the Bureau of Labor Statistics, Lexie is:

employed

When the government enforces contracts between two parties, it is acting in its role to promote economic growth by:

ensuring a stable legal system.

Arlina got a 5% raise while the rate of inflation was 6%. Arlina's standard of living:

fell by about 1%.

To have long-term economic growth, the production function suggests

increasing the availability of technology, capital, and labor

A simple circular flow diagram shows that the factors of production are:

purchased by businesses

The national income and product accounts provide:

the ability to track business cycles

The single largest consumer of goods and services in the United States is

the government.

Zach has been laid off from his job as an aircraft worker and is afraid that he will not be recalled. He has been actively looking for a job but has had no luck for the past six weeks. According to the Bureau of Labor Statistics, Zach is:

unemployed

If personal consumption is $100, investment is $25, government purchases total $25, imports equal $20, and exports equal $10, then GDP equals:

$140

An economy has a population of 226,500. Of them, 12,500 are unemployed and actively seeking work, and 35,000 have given up looking for a job. Also, 28,000 people work part-time, and 151,000 people work full-time. This economy's unemployment rate is _______. (Round the percentage to one decimal place; for example, 0.0436 is 4.4%.)

6.5%

Jennifer just got news that she is getting a 5% raise. However, the Bureau of Labor Statistics just reported that prices are rising by 7%.

Jennifer is losing purchasing power by 2%.

_____ unemployment is caused by changes in consumer demands or technology.

Structural

Which ONE of the following would be included in the GDP calculations?

a hamburger purchased by a hungry restaurant patron

Developing countries can achieve higher productivity per unit of capital because they can use technologies developed by other countries. This is known as the:

catch-up effect.

The mortgage crisis caused a lot of consumers to stop spending money. The decrease in spending led to a decrease in production. Which type of unemployment resulted?

cyclical

The government decides to give tax-exempt status to a new organization whose mission is to award college scholarships to members of the armed forces. In doing so, the government is acting in its role to promote economic growth by:

enhancing physical and human capital.

An economy has historically grown at a rate of 2.25%. Currently, this economy is growing at a rate of 3%, and the unemployment rate is low by historical standards. The economy is expected to continue to grow in the near future, and the monetary authorities are concerned that inflation may increase. This economy is probably in the _____________ stage of the business cycle.

expansion

Jennifer did not work during college. She just obtained a bachelor's degree in marketing, and she is now looking for a marketing job in the retail industry. Jennifer is considered:

frictionally unemployed

Which of the following activities is an example of a nonmarket transaction?

growing your own food in a vegetable garden

If a country's population increases at a higher rate than the growth in its real GDP:

he standard of living in the country has declined

Improvements in production capacity will:

shift the PPF outward.

GDP can be found either by adding up all of the __________ or all of the __________ in the economy.

spending; income

A benefit of using GDP per capita instead of GDP is that it:

takes into account the size of the population when measuring the value of the goods and services a country produces.

What event was a major influence on the development of macroeconomics?

the Great Depression

Human capital includes:

the improvements to labor capabilities from training, education, and apprenticeship programs.

A business cycle is:

the periodic fluctuation of economic activity

The National Bureau of Economic Research determines that a recession is over:

when the economy is in a trough