Question 1

During the mid-1980s,we observed a significant reduction in oil prices.In the United States,we would expect that this reduction in oil prices would cause

Accepted Answer

A)  a larger reduction in the CPI compared to the GDP deflator.
B)  an equal reduction in the CPI and GDP deflator.
C)  a larger reduction in the GDP deflator compared to the CPI.
D)  no change in the CPI and a reduction in the GDP deflator.

Question 2

Explain whether it is possible for nominal GDP to increase and real GDP to decrease in the same period.

Accepted Answer

Nominal GDP can rise because either the ...

Question 3

Pure inflation occurs when

Accepted Answer

A)  nominal wages rise faster than all prices.
B)  all prices rise faster than nominal wages.
C)  all prices and nominal wages rise by the same percentage.
D)  the GDP deflator and Consumer Price Index rise by the same percentage.
E)  none of the above

Question 4

Prices for which of the following are included in the GDP deflator,but not included in the Consumer Price Index?

Accepted Answer

A)  firms' purchases of new equipment
B)  intermediate goods and services
C)  consumption of goods
D)  consumption of services

Question 5

Labor income's share in an advanced country is likely to be

Accepted Answer

A)  70%.
B)  45%.
C)  29%.
D)  10%.
E)  none of the above

Question 6

Suppose nominal GDP in 2009 does not change (compared its previous level in 2008) .Given this information,we know with certainty that

Accepted Answer

A)  real GDP increased during 2009.
B)  the GDP deflator increased during 2009.
C)  both the GDP deflator and real GDP fell during 2009.
D)  more information is needed to answer this question.

Question 7

A firm's value added equals

Accepted Answer

A)  its revenue minus all of its costs.
B)  its revenue minus its wages.
C)  its revenue minus its wages and profit.
D)  its revenue minus its cost of intermediate goods.
E)  none of the above

Question 8

Changes in GDP in the medium run are determined primarily by

Accepted Answer

A)  demand factors.
B)  supply factors.
C)  monetary policy.
D)  all of the above

Question 9

Which of the following tends to occur when the unemployment rate increases?

Accepted Answer

A)  a reduction in the labor force participation rate
B)  a reduction in the number of discouraged workers
C)  an increase in the number of employed workers
D)  all of the above
E)  none of the above

Question 10

The GDP deflator provides a measure of which of the following?

Accepted Answer

A)  the ratio of GDP to the size of the population
B)  the ratio of GDP to the number of workers employed
C)  the ratio of nominal GDP to real GDP
D)  the price of a typical consumer's basket of goods
E)  real GDP divided by the aggregate price level

Question 11

The labor force in the United States is defined as

Accepted Answer

A)  the total number of individuals who are employed.
B)  the sum of the total number of individuals who are employed and the officially unemployed.
C)  the sum of the total number of individuals who are employed,the officially unemployed,and discouraged workers.
D)  the total number of individuals who are 16 years old and older,but not retired.
E)  none of the above

Question 12

Measures of aggregate output have been published on a regular basis in the United States since

Accepted Answer

A)  1947.
B)  1933.
C)  1917.
D)  1946.

Question 13

Which of the following calculations will yield the correct measure of real GDP?

Accepted Answer

A)  divide nominal GDP by the consumer price index
B)  divide the GDP deflator by the consumer price index
C)  multiply nominal GDP by the consumer price index
D)  multiply nominal GDP by the GDP deflator
E)  none of the above

Question 14

Explain the difference between the unemployment rate and the participation rate.

Accepted Answer

The unemployment rate is the percentage ...

Question 15

Use the information provided below to answer the following questions.
Suppose a country using the United States' system of calculating official unemployment statistics has 100 million people,of whom 50 million are working age.Of these 50 million,20 million have jobs.Of the remainder: 10 million are actively searching for jobs; 10 million would like jobs but are not searching; and 10 million do not want jobs at all.
-Refer to the information above.The labor force is

Accepted Answer

A)  20 million.
B)  40 million.
C)  60 million.
D)  80 million.
E)  100 million.

Question 16

The Phillips curve describes the relationship between

Accepted Answer

A)  output growth and unemployment.
B)  inflation and output growth.
C)  output growth and money supply.
D)  inflation and unemployment .

Question 17

Suppose you are provided with the following data for your country for a particular month: 200 million people are working,20 million are not working but are looking for work,and 40 million are not working and have given up looking for work.The official unemployment rate for that month is

Accepted Answer

A)  7.7%.
B)  9.1%.
C)  10%.
D)  23%.
E)  30%.

Question 18

First,define nominal GDP and real GDP.Second,is it possible for nominal GDP in a year to be less than real GDP in the same year? Explain.

Accepted Answer

Nominal GDP represents the value of good...

Question 19

Which of the following about the Phillips curve is NOT correct?

Accepted Answer

A)  It shows the relation between GDP growth and unemployment.
B)  It has been redefined as a relation between the change in the rate of inflation and the unemployment rate.
C)  It was first explored by A.W.Phillips.
D)  The curve is downward sloping.

Question 20

Changes in GDP in the short run are caused primarily by

Accepted Answer

A)  demand factors.
B)  supply factors.
C)  technology.
D)  capital accumulation.
E)  all of the above

Exam 2: A Tour of the Book

Correct Answer
verified

First,define nominal GDP and real GDP.Second,is it possible for nominal GDP in a year to be less than real GDP in the same year? Explain.

Correct Answer
verified
Nominal GDP represents the value of good...
View Answer

Labor income's share in an advanced country is likely to be

Correct Answer
verified

Measures of aggregate output have been published on a regular basis in the United States since

Correct Answer
verified

Which of the following about the Phillips curve is NOT correct?

Correct Answer
verified

During the mid-1980s,we observed a significant reduction in oil prices.In the United States,we would expect that this reduction in oil prices would cause

Correct Answer
verified

Changes in GDP in the medium run are determined primarily by

Correct Answer
verified

Pure inflation occurs when

Correct Answer
verified

Which of the following tends to occur when the unemployment rate increases?

Correct Answer
verified

Changes in GDP in the short run are caused primarily by

Correct Answer
verified

Which of the following calculations will yield the correct measure of real GDP?

Correct Answer
verified

Explain the difference between the unemployment rate and the participation rate.

Correct Answer
verified
The unemployment rate is the percentage ...
View Answer

Suppose nominal GDP in 2009 does not change (compared its previous level in 2008) .Given this information,we know with certainty that

Correct Answer
verified

The GDP deflator provides a measure of which of the following?

Correct Answer
verified

Explain whether it is possible for nominal GDP to increase and real GDP to decrease in the same period.

Correct Answer
verified
Nominal GDP can rise because either the ...
View Answer

The labor force in the United States is defined as

Correct Answer
verified

A firm's value added equals

Correct Answer
verified

The Phillips curve describes the relationship between

Correct Answer
verified

Prices for which of the following are included in the GDP deflator,but not included in the Consumer Price Index?

Correct Answer
verified

Suppose you are provided with the following data for your country for a particular month: 200 million people are working,20 million are not working but are looking for work,and 40 million are not working and have given up looking for work.The official unemployment rate for that month is

Correct Answer
verified

Exam 2: A Tour of the Book

Correct AnswerverifiedShow Answer

First,define nominal GDP and real GDP.Second,is it possible for nominal GDP in a year to be less than real GDP in the same year? Explain.

Correct AnswerverifiedNominal GDP represents the value of good...View AnswerShow Answer

Labor income's share in an advanced country is likely to be

Correct AnswerverifiedShow Answer

Measures of aggregate output have been published on a regular basis in the United States since

Correct AnswerverifiedShow Answer

Which of the following about the Phillips curve is NOT correct?

Correct AnswerverifiedShow Answer

During the mid-1980s,we observed a significant reduction in oil prices.In the United States,we would expect that this reduction in oil prices would cause

Correct AnswerverifiedShow Answer

Changes in GDP in the medium run are determined primarily by

Correct AnswerverifiedShow Answer

Pure inflation occurs when

Correct AnswerverifiedShow Answer

Which of the following tends to occur when the unemployment rate increases?

Correct AnswerverifiedShow Answer

Changes in GDP in the short run are caused primarily by

Correct AnswerverifiedShow Answer

Which of the following calculations will yield the correct measure of real GDP?

Correct AnswerverifiedShow Answer

Explain the difference between the unemployment rate and the participation rate.

Correct AnswerverifiedThe unemployment rate is the percentage ...View AnswerShow Answer

Suppose nominal GDP in 2009 does not change (compared its previous level in 2008) .Given this information,we know with certainty that

Correct AnswerverifiedShow Answer

The GDP deflator provides a measure of which of the following?

Correct AnswerverifiedShow Answer

Explain whether it is possible for nominal GDP to increase and real GDP to decrease in the same period.

Correct AnswerverifiedNominal GDP can rise because either the ...View AnswerShow Answer

The labor force in the United States is defined as

Correct AnswerverifiedShow Answer

A firm's value added equals

Correct AnswerverifiedShow Answer

The Phillips curve describes the relationship between

Correct AnswerverifiedShow Answer

Prices for which of the following are included in the GDP deflator,but not included in the Consumer Price Index?

Correct AnswerverifiedShow Answer

Suppose you are provided with the following data for your country for a particular month: 200 million people are working,20 million are not working but are looking for work,and 40 million are not working and have given up looking for work.The official unemployment rate for that month is

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
Nominal GDP represents the value of good...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
verified
The unemployment rate is the percentage ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Nominal GDP can rise because either the ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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