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Which of the following would NOT be expected to increase labor productivity?
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An increase in the size of the labor force.
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Empirical Studies suggest that
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Technological Advances account for about 40% of US productivity growth
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Economies of Scale refers to
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The fact that large producers may be able to use more efficient technologies than smaller producers.
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Globally, on the average test scores of 8th grade math and science students, the USA ranks (as of 2011)
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9th and 10th, respectively
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Critics of economic growth
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Argue that economic growth does not resolve socioeconomic problems such as an unequal distribution of income and wealth
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A nation's real GDP was $250 billion in 2015 and $265 billion in 2016. Its population was 120 million in 2015 and 125 million in 2016. What is its real GDP growth rate in 2016?
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6.0%
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Consider two scenarios for a nation's economic growth. Scenario A has Real GDP growing at an average annual rate of 3.5%. Scenario B has an average annual growth of 4.5%. The nation's real GDP would double in about
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20 years under scenario A, versus 16 years under scenario B.
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An antigrowth view would be that there may be a significant trade-off between productivity and
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The quality of life
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Real GDP per capita
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Can grow either more slowly or more rapidly than Real GDP.
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In the periods 1995-2007 and 2007-2015, the USA Real GDP grew at the average annual rates of about
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3.2 % and 1.2 %
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The entry of women into the workforce since the 1960's resulted in
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A shift outward in the production possibilities curve of the United States.
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One of the main arguments against further growth for industrialized nations focuses on the problem of
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Environmental Quality
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Recurring upswings and downswings in an economy's real GDP over time are called
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Business Cycles
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The industries or sectors of the economy in which business cycle fluctuations tend to affect output most are
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Capital Goods and Durable Consumer Goods.
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The phase of the business cycle in which real GDP is at a minimum is called
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The trough
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The table contains information about the hypothetical economy of Scoob. All figures are in millions. The labor force in Scoob is
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102 million.
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The table contains information about the hypothetical economy of Scoob. All figures are in millions. The unemployment rate in Scoob is
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6.9 percent.
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Kara voluntarily quit her job as an insurance agent to return to school full time to earn an MBA degree. With degree in hand, she is now searching for a position in management. Kara presently is
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Frictionally Unemployed.
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Assuming the total population is 100 million, the civilian labor force is 50 million, and 47 million workers are employed, the unemployment rate is
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6 percent.
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The natural rate of unemployment is the
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full-employment unemployment rate.
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Suppose there are 5 million unemployed workers seeking jobs. After a period of time, 1 million of them become discouraged over their job prospects and cease to look for work. As a result of this, all else equal, the official unemployment rate would
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Decline.
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Cyclical Unemployment results from
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A deficiency of spending on goods and services.
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Assume the natural rate of unemployment in the U.S. economy is 5 percent and the actual rate of unemployment is 9 percent. According to Okun's law, the negative GDP gap as a percentage of potential GDP is
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8 %
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For every 1 percentage point that the actual unemployment rate exceeds the natural rate, a 2 percentage point negative GDP gap occurs. This is a statement of
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Okun's law.
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The consumer price index was 177.1 in 2001 and 179.9 in 2002. Therefore, the rate of inflation in 2002 was about
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1.6%
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The annual rate of inflation can be found by subtracting
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Last year's price index from this year's price index and dividing the difference by last year's price index
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Demand-pull inflation
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Occurs when total spending exceeds the economy's ability to provide output at the existing price level.
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Inflation initiated by increases in wages or other resource prices is labeled
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Cost-Push Inflation.
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A lender need not be penalized by inflation if the
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lender correctly anticipates inflation and increases the nominal interest rate accordingly.
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If the nominal interest rate is 5 percent and the real interest rate is 2 percent, then the inflation premium is
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3 percent.
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If both the real interest rate and the nominal interest rate are 3 percent, then the
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Inflation premium is zero.
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Suppose the nominal annual interest rate on a two-year loan is 8 percent and lenders expect inflation to be 5 percent in each of the two years. The annual real rate of interest is
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3 percent.
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The unemployment rate in an economy is 7.5 percent. The total population of the economy is 250 million and the size of the civilian labor
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166.5 million.
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"Full employment" refers to the situation when there is
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no cyclical unemployment.
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If the natural rate of unemployment is 4.5 percent and the actual unemployment rate is 6.5 percent, then Okun's law indicates that the GDP gap is
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4 percent
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When inflation occurs,
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The purchasing power of money decreases.
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The inflation rate measures the percentage growth rate of
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The CPI from one year to the next.
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If Carol's disposable income increases from $1,200 to $1,700 and her level of saving increases from minus $100 to a plus $100, her marginal propensity to
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consume is three-fifths.
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With a marginal propensity to save of 0.4, the marginal propensity to consume will be
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1.0 minus 0.4.
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As disposable income goes up, the
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Average Propensity to consume falls.
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The consumption schedule shows
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The amounts households intend to consume at various possible levels of aggregate income.
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The APC is calculated as
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consumption/income.
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The consumption schedule is drawn on the assumption that as income increases, consumption will
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Increase absolutely but decline as a percentage of income.
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Which of the following is correct?
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APC + APS = 1
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As disposable income increases, consumption
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And saving both increase
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Suppose a family's consumption exceeds its disposable income. This means that its
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APC is greater than 1.
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Which of the following is correct?
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MPC + MPS = APC + APS.
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Dissaving means
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That households are spending more than their current incomes.
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At the point where the consumption schedule intersects the 45-degree line,
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Saving is zero.
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If the marginal propensity to consume is 0.9, then the marginal propensity to save must be
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0.1.
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The investment demand curve portrays an inverse (negative) relationship between
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The real interest rate and investment.
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The relationship between the real interest rate and investment is shown by the
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Investment Demand Schedule.
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