Macroeconomics Midterm 2

C + I + G + X equals

GDP

When did the United States register its lowest unemployment rate?

at the end of World War II

Intermediate goods are

goods that are used up entirely in the production of final goods.

In the history of the United States, unemployment reached its highest rate

in the 1930s.

Goods that are used up entirely in the production of final goods are known as

intermediate goods.

The real rate of interest is the

nominal rate of interest minus the anticipated rate of inflation.

Per capita real GDP is a measure of

productive activity.

Per capita real Gross Domestic Product (GDP) is

real Gross Domestic Product (GDP) divided by the population.

To determine how well an economy is doing, it is better to use

real Gross Domestic Product (GDP) figures.

Labor productivity measures

real output per labor hour.

Which of the following measures gives the earliest warning of increasing inflation?

the Producer Price Index

The nominal value of a good is

the price of the good in today's dollars.

The sum of the value added at all stages of production for a product is

the product's final price.

In computing a price index,

the quantities in the market basket stay the same while the prices differ.

The value of an item expressed in inflation adjusted dollars is known as

the real value.

Depreciation is

the reduction in the value of capital goods due to physical wear and tear.

The rate of unemployment is calculated as the number of

unemployed divided by the number of people in the civilian labor force.

How has the pattern of movements in the U.S. price level changed since World War II?

Periods of deflation have largely been eliminated.

Labor productivity is measured by

Real GDP/Total Hours Worked

The value of total output and total income in the simple circular flow model

are equal to each other.

Which of the following is part of gross private domestic investment?

a positive change in business inventories

The term "value added" refers to the dollar value of

an industry's sales less the dollar value of the intermediate goods purchased by the industry.