question
Refer to Exhibit 6-1. Prices rose by __________ percent from Year 2 to Year 3.
answer
2.27
question
Refer to Exhibit 6-1. Prices rose by approximately __________ percent from Year 1 to Year 5.
answer
10.6
question
A person in the civilian labor force falls into one of two categories:
answer
unemployed or employed.
question
If a person did any work as a paid employee during the Bureau of Labor Statistics survey reference week, how is she classified?
answer
as an employed person and as part of the labor force
question
The unemployment rate equals the
answer
number of unemployed persons divided by the civilian labor force.
question
Refer to Exhibit 6-2. How many persons are unemployed in year 2?
answer
100 million
question
In an economy with 200 million people, 140 million hold civilian jobs and 9 million are not working but are looking for jobs. The unemployment rate is
answer
6.0%
question
If there are 10 job losers, 12 job leavers, 13 reentrants, and 12 new entrants, then there are __________ unemployed persons.
answer
47
question
A plumber who quits his job in Indianapolis and moves to Orlando where additional plumbers are needed is said to be ___________________ unemployed
answer
frictionally
question
Bentley's income was $48,000 in year 1 and $52,600 in year 2. The CPI was 120.3 in year 1 and 125.4 in year 2. What was the approximate percentage change in Bentley's real income between the two years?
answer
5.1%
question
Suppose that in an economy the structural unemployment rate is 3.1 percent, the frictional unemployment rate is 1.7 percent, and the unemployment rate is 8.1 percent. The natural unemployment rate is _________ percent and the cyclical unemployment rate is ___________ percent.
answer
4.8; 3.3
question
The best reason economists take only final goods and services into account when calculating GDP is that
answer
they want to avoid the problem of double counting.
question
The largest component of national income in the United States is
answer
compensation of employees
question
Refer to Exhibit 7-1. Which of the following summations represents GDP using the expenditure approach?
answer
$4,150 + $751 + $850 + $331 + $300 - $320
question
If in the process of calculating GDP, the market value of all intermediate goods is added to the market value of all final goods, this would
answer
overstate the actual value of GDP.
question
The base year is the year
answer
that serves as a reference point or benchmark.
question
Refer to Exhibit 7-2. GDP in 2019 is
answer
$86
question
Suppose that net exports are -$140 billion and exports are $240 billion. Imports must be equal to
answer
$380 billion
question
Suppose that inventory investment is $20 billion and (total) investment is $680 billion. What does purchases of newly produced capital goods equal?
answer
There is not enough information to answer this question
question
An aggregate demand (AD) curve shows the
answer
real output (Real GDP) people are willing and able to buy at different price levels, ceteris paribus.
question
The real balance effect is one of the
answer
reasons why an AD curve is downward-sloping
question
A decrease in the price of a nonlabor input such as electricity will cause
answer
a rightward shift in the SRAS curve.
question
The aggregate demand (AD) curve has shifted to the right. This is a result of
answer
total expenditures increasing at a given price level.
question
Business taxes fall. This raises __________, which raises __________ and the __________ curve shifts rightward.
answer
investment; aggregate demand (AD); AD
question
Refer to Exhibit 8-1. Assume that the economy is originally in equilibrium at point A. If businesses become more optimistic about future sales, at which point is the economy most likely to end up in the short run?
answer
B
question
Refer to Exhibit 8-1. Assume that the economy is originally in equilibrium at point A. If foreign real national income rises, at which point is the economy most likely to end up in the short run?
answer
B
question
Refer to Exhibit 8-1. Assume the economy is originally in equilibrium at point A. If wage rates rise, at which point is the economy most likely to end up in the short run?
answer
D
question
f Real GDP is less than Natural Real GDP, the economy is in
answer
A recessionary gap
question
Refer to Exhibit 9-2. The economy is currently producing Q1. At this level of Real GDP, the economy is experiencing
answer
A shortage in the labor market
question
If the current unemployment rate is less than the natural unemployment rate, then the economy is
answer
in an inflationary gap.
question
If the economy is operating at a point beyond its institutional production possibilities frontier (institutional PPF), then the economy is
answer
producing more than Natural Real GDP and operating below the natural unemployment rate.
question
In a barter economy, Say's law implies there
answer
cannot be a general overproduction or underproduction of goods.
question
According to the classical economists, which of the following statements is false?
answer
There is a direct relationship between the amount business firms invest and the interest rate
question
Which of the following is consistent with the classical position on wages and prices?
answer
wages and prices are flexible
question
Refer to Exhibit 9-6. If the economy is self-regulating and currently at point 1, it follows that
answer
there is a surplus of labor in the labor market.
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