question
CHAPTER 5
answer
-
question
The trend of the economy is
A) the long run growth path of the economy
B) the long run inflation rate
C) the long run unemployment rate
D) the short run production capacity of an economy
A) the long run growth path of the economy
B) the long run inflation rate
C) the long run unemployment rate
D) the short run production capacity of an economy
answer
A) the long run growth path of the economy
question
The unemployment rate equals
A) labor force/population
B) unemployed/employed
C) (employed-unemployed)/labor force
D) (labor force-employed)/labor force
A) labor force/population
B) unemployed/employed
C) (employed-unemployed)/labor force
D) (labor force-employed)/labor force
answer
D) (labor force-employed)/labor force
question
If output is rising and unemployment is falling, the economy MUST be in a(n)
A) contraction
B) expansion
C) depression
D) hyperinflationary period
A) contraction
B) expansion
C) depression
D) hyperinflationary period
answer
B) expansion
question
Which of the following statements is FALSE?
A) The rate of change in economic activity is used to assess whether an economy is expanding or contracting.
B) Short-term ups and downs in the economy are known as business cycles.
C) During a recession, output and employment are falling.
D) Business cycles are always symmetric—the length of an expansion is the same as the length of a contraction.
A) The rate of change in economic activity is used to assess whether an economy is expanding or contracting.
B) Short-term ups and downs in the economy are known as business cycles.
C) During a recession, output and employment are falling.
D) Business cycles are always symmetric—the length of an expansion is the same as the length of a contraction.
answer
D) Business cycles are always symmetric—the length of an expansion is the same as the length of a contraction.
question
In the circular flow diagram, the different payments made by firms to households include
A) wages and profits.
B) interest and taxes.
C) transfer payments and dividends.
D) taxes and transfer payments.
A) wages and profits.
B) interest and taxes.
C) transfer payments and dividends.
D) taxes and transfer payments.
answer
A) wages and profits
question
The major lesson of the circular flow diagram is that
A) saving must always be less than investment.
B) taxes must always be greater than government expenditures.
C) total income in the economy must always equal total spending.
D) tax receipts must be equal to transfer payments.
A) saving must always be less than investment.
B) taxes must always be greater than government expenditures.
C) total income in the economy must always equal total spending.
D) tax receipts must be equal to transfer payments.
answer
C) total income in the economy must always equal total spending.
question
Macroeconomic policies became more influenced by Keynes' theories starting with,
A) the period of high unemployment and high inflation in the 1970s.
B) the Great Depression.
C) the period of high inflation in the early 1980s.
D) the OPEC recession.
A) the period of high unemployment and high inflation in the 1970s.
B) the Great Depression.
C) the period of high inflation in the early 1980s.
D) the OPEC recession.
answer
B) the Great Depression
question
CHAPTER 6
answer
...
question
Gross domestic product measures
A) the total spending of everyone in the economy.
B) the value of all output in the economy.
C) the total income in the economy.
D) all of the above
A) the total spending of everyone in the economy.
B) the value of all output in the economy.
C) the total income in the economy.
D) all of the above
answer
D) all of the above
question
Which of the following is an example of a final good or service?
A) wheat a bakery purchases to make bread
B) coffee beans Starbucks purchases to make coffee
C) lumber purchased by a construction company to be used in building houses
D) a computer purchased by Federal Express to track shipments
A) wheat a bakery purchases to make bread
B) coffee beans Starbucks purchases to make coffee
C) lumber purchased by a construction company to be used in building houses
D) a computer purchased by Federal Express to track shipments
answer
D) a computer purchased by Federal Express to track shipments
question
Double counting can be avoided by
A) including the value of intermediate goods in the current year.
B) not counting the value of intermediate goods in GDP.
C) including the value of intermediate goods in the GNP but not in the GDP.
D) including the value of intermediate goods in the production year but not in the selling year of those goods.
A) including the value of intermediate goods in the current year.
B) not counting the value of intermediate goods in GDP.
C) including the value of intermediate goods in the GNP but not in the GDP.
D) including the value of intermediate goods in the production year but not in the selling year of those goods.
answer
B) not counting the value of intermediate goods in GDP.
question
Which of the following would NOT be counted in 2013's GDP?
A) the value of a 2008 boat you purchase from your friend in 2013
B) the 2013 salary of a used motorcycle salesperson
C) the commissions earned by a real estate agent in selling condominiums built prior to 2013
D) the value of a refrigerator manufactured in 2013 but not sold in 2013
A) the value of a 2008 boat you purchase from your friend in 2013
B) the 2013 salary of a used motorcycle salesperson
C) the commissions earned by a real estate agent in selling condominiums built prior to 2013
D) the value of a refrigerator manufactured in 2013 but not sold in 2013
answer
A) the value of a 2008 boat you purchase from your friend in 2013
question
The value of what KFC produces in Japan is included in the U.S. ________ and in the Japanese ________.
A) GDP; GDP
B) GNP; GNP
C) GNP; GDP
D) GDP; GNP
A) GDP; GDP
B) GNP; GNP
C) GNP; GDP
D) GDP; GNP
answer
C) GNP; GDP
question
The equation for GDP using the expenditure approach is
A) GDP = C + I + G + EX - IM.
B) GDP = C + I + G + (IM - EX).
C) GDP = C + I + G + EX + IM.
D) GDP = C + I + G - EX - IM.
A) GDP = C + I + G + EX - IM.
B) GDP = C + I + G + (IM - EX).
C) GDP = C + I + G + EX + IM.
D) GDP = C + I + G - EX - IM.
answer
A) GDP = C + I + G + EX - IM.
question
The single largest expenditure component in GDP is
A) government spending.
B) investment.
C) consumption.
D) net exports.
A) government spending.
B) investment.
C) consumption.
D) net exports.
answer
C) consumption
question
A farmer buys a new tractor from John Deere to use on her cotton farm. This tractor is included in GDP as
A) part of gross private domestic investment.
B) a durable consumption good.
C) a service.
D) a nondurable consumption good.
A) part of gross private domestic investment.
B) a durable consumption good.
C) a service.
D) a nondurable consumption good.
answer
A) part of gross private domestic investment
question
If the change in business inventories is zero, then final sales are
A) zero.
B) less than GDP.
C) greater than GDP.
D) equal to GDP.
A) zero.
B) less than GDP.
C) greater than GDP.
D) equal to GDP.
answer
D) equal to GDP
question
The largest income component of GDP is
A) proprietors' income.
B) rental income.
C) compensation of employees.
D) corporate profit.
A) proprietors' income.
B) rental income.
C) compensation of employees.
D) corporate profit.
answer
C) compensation of employees
question
The total income of households is
A) net national product.
B) personal income.
C) national income.
D) production income.
A) net national product.
B) personal income.
C) national income.
D) production income.
answer
B) personal income
question
If real GDP in 2012 using 2011 prices is lower than nominal GDP of 2012, then
A) prices in 2012 are lower than prices in 2011.
B) nominal GDP in 2012 equals nominal GDP in 2011.
C) prices in 2012 are higher than prices in 2011.
D) real GDP in 2012 is larger than real GDP in 2011.
A) prices in 2012 are lower than prices in 2011.
B) nominal GDP in 2012 equals nominal GDP in 2011.
C) prices in 2012 are higher than prices in 2011.
D) real GDP in 2012 is larger than real GDP in 2011.
answer
C) prices in 2012 are higher than prices in 2011.
question
Assume that an economy produces only two goods Good X and Good Y. If year 1 is the base year, the value for this economy's GDP deflator in year 1 is
A) 1.
B) 100.
C) 110.
D) 111.
A) 1.
B) 100.
C) 110.
D) 111.
answer
B) 100
question
If the GDP deflator is greater than 100, then
A) nominal GDP is greater than real GDP.
B) nominal GDP is lower than real GDP.
C) nominal GDP equals real GDP.
D) prices decreased by more than half between the current and the base years.
A) nominal GDP is greater than real GDP.
B) nominal GDP is lower than real GDP.
C) nominal GDP equals real GDP.
D) prices decreased by more than half between the current and the base years.
answer
A) nominal GDP is greater than real GDP.
question
GDP is not a perfect measure of social welfare and the society's economic well-being because
A) it does not say anything about the distribution of income.
B) GDP accounting rules do not adjust for production that causes negative externalities.
C) it does not include all economic activities in the economy.
D) all of the above
A) it does not say anything about the distribution of income.
B) GDP accounting rules do not adjust for production that causes negative externalities.
C) it does not include all economic activities in the economy.
D) all of the above
answer
D) all of the above
question
CHAPTER 7
answer
...
question
Diane lost her job and immediately started looking for another job. As a result the
A) unemployment rate increases.
B) labor force increases.
C) labor force decreases.
D) unemployment rate remains constant.
A) unemployment rate increases.
B) labor force increases.
C) labor force decreases.
D) unemployment rate remains constant.
answer
A) unemployment rate increases
question
In the United States in 2015 on p. 126, the highest unemployment rate was for ________ and the lowest was for ________.
A) African-American teenagers; white men
B) white teenagers; white women
C) African-American teenagers; white women
D) African-American women; white men
A) African-American teenagers; white men
B) white teenagers; white women
C) African-American teenagers; white women
D) African-American women; white men
answer
D?
question
Mike has just graduated from college and is now looking for a job, but has not yet found one. This causes the unemployment rate to ________ and the labor-force participation rate to ________.
A) increase; decrease
B) stay the same; stay the same
C) increase; increase
D) increase; stay the same
A) increase; decrease
B) stay the same; stay the same
C) increase; increase
D) increase; stay the same
answer
C) increase; increase
question
When 100 people who were previously looking for jobs stop looking for jobs, the
A) unemployment rate increases.
B) size of the labor force decreases.
C) labor-force participation rate does not change.
D) unemployment rate does not change.
A) unemployment rate increases.
B) size of the labor force decreases.
C) labor-force participation rate does not change.
D) unemployment rate does not change.
answer
B) size of the labor force decreases
question
Classifying discouraged workers as unemployed would
A) increase the unemployment rate.
B) decrease the unemployment rate.
C) not change the unemployment rate.
D) have an indeterminate impact on the unemployment rate.
A) increase the unemployment rate.
B) decrease the unemployment rate.
C) not change the unemployment rate.
D) have an indeterminate impact on the unemployment rate.
answer
A) increase the unemployment rate
question
During recessions, the number of discouraged workers ________ and this ________ the unemployment rate.
A) falls; reduces
B) decreases; increases
C) increases; reduces
D) increases; increases
A) falls; reduces
B) decreases; increases
C) increases; reduces
D) increases; increases
answer
C) increases; reduces
question
When the Fed slows the rate of growth of the money supply to slow down the economy, the unemployment type that will be directly affected is the
A) frictional unemployment.
B) structural unemployment.
C) cyclical unemployment.
D) natural rate of unemployment.
A) frictional unemployment.
B) structural unemployment.
C) cyclical unemployment.
D) natural rate of unemployment.
answer
C) cyclical unemployment
question
In which of the following conditions is the inflation rate likely to fall and the unemployment rate likely to rise?
A) hyperinflation
B) recession
C) boom
D) stagflation
A) hyperinflation
B) recession
C) boom
D) stagflation
answer
B) recession
question
Which of the following increases the real interest rate?
A) a decrease in the nominal interest rate, holding the inflation rate constant
B) an increase in both the nominal interest rate and the inflation rate by the same percentage points
C) a decrease in the inflation rate, holding the nominal interest rate constant
D) a decrease in both the nominal interest rate and the inflation rate by the same percentage points
A) a decrease in the nominal interest rate, holding the inflation rate constant
B) an increase in both the nominal interest rate and the inflation rate by the same percentage points
C) a decrease in the inflation rate, holding the nominal interest rate constant
D) a decrease in both the nominal interest rate and the inflation rate by the same percentage points
answer
C) a decrease in the inflation rate, holding the nominal interest rate constant
question
If the inflation rate is smaller than the nominal interest rate, the real interest rate is
A) positive.
B) negative.
C) zero.
D) either positive or zero.
A) positive.
B) negative.
C) zero.
D) either positive or zero.
answer
A) positive ??
question
Which of the following statements is FALSE?
A) Whether you gain or lose during a period of inflation depends on whether your income rises faster or slower than the prices of the things you buy.
B) Inflation that is higher than expected benefits debtors, and inflation that is lower than expected benefits creditors.
C) There are no costs or losses associated with anticipated inflation.
D) When unanticipated inflation occurs regularly, the degree of risk associated with investments in the economy increases.
A) Whether you gain or lose during a period of inflation depends on whether your income rises faster or slower than the prices of the things you buy.
B) Inflation that is higher than expected benefits debtors, and inflation that is lower than expected benefits creditors.
C) There are no costs or losses associated with anticipated inflation.
D) When unanticipated inflation occurs regularly, the degree of risk associated with investments in the economy increases.
answer
C) there are no costs or losses associated with anticipated inflation
question
Related to the Economics in Practice on p. 133: If a retiree's pension is tied to the CPI, her monthly pension check would tend to grow ________ if the pension is tied to the ________ CPI.
A) slower; fixed-weight
B) slower; chain-linked
C) faster; chain-linked
D) The check would grow at the same rate regardless of the type of CPI to which it is tied.
A) slower; fixed-weight
B) slower; chain-linked
C) faster; chain-linked
D) The check would grow at the same rate regardless of the type of CPI to which it is tied.
answer
...
question
We can safely say that total output can increase if there is a(n)
A) increase in the size of the labor force and a decrease in the productivity of workers.
B) decrease in the size of capital and an increase in the productivity of machines.
C) increase in the number of machines per worker.
D) decrease in the number of workers per machine.
A) increase in the size of the labor force and a decrease in the productivity of workers.
B) decrease in the size of capital and an increase in the productivity of machines.
C) increase in the number of machines per worker.
D) decrease in the number of workers per machine.
answer
C) increase in the number of machines per worker
question
For the 1952-2012 period in the United States, output per worker hour
A) increased at a constant rate.
B) decreased during the 1960s.
C) fluctuated around an upward trend.
D) showed the largest increase during the 1980s.
A) increased at a constant rate.
B) decreased during the 1960s.
C) fluctuated around an upward trend.
D) showed the largest increase during the 1980s.
answer
C) fluctuated around an upward trend
question
All of the following explain the growth in output per worker hour during the 20th century EXCEPT
A) the quality of labor improved during that period.
B) the quantity of labor increased during that period.
C) the quality of capital improved during that period.
D) the worker capital ratio decreased during that period.
A) the quality of labor improved during that period.
B) the quantity of labor increased during that period.
C) the quality of capital improved during that period.
D) the worker capital ratio decreased during that period.
answer
D) the worker capital ratio decreased during that period
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
