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Unit 4: Macroeconomics Flashcards | StudBud
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Unit 4: Macroeconomics
Unit 4: Macroeconomics
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Answers
1
In this formula, what does "
C
" represent?
Consumer Wages
Consumer Purchases
Customs Duties
Credit
2
When calculating GDP, the purchase of a new business office is counted as
consumption
net export
investment
goverment
3
Retail profits fell leading to the termination of a cashier. Cashier is _ unemployed.
Cyclically (cyclical)
Frictionally (frictional)
Not Counted as Unemployed
Structurally (structural)
4
Which component of GDP can be a negative number?
consumer spending
net migration
investment spending
net exports
5
Toll-booth cashier becomes unemployed when a machine does his job better. He is ___ unemployed.
Structurally (structural)
Frictionally (frictional)
Not Counted as Unemployed
Cyclically (cyclical)
6
What is the primary difference between
seasonal unemployment
and
structural unemployment
?
Seasonal unemployment is generally among low-paid workers
Seasonal unemployment occurs because of temporary demand
Seasonal unemployment is rare in a modern society
Structural unemployment can occur all year round
7
In Macroeconomics, what do we call the
lowest point
of the Business Cycle?
an inflation
the peak
a depression
a trough
8
In this formula, what does "
I
" represent?
Interest income
Consumer investments in banks
Government investments in society
Aggregate investments made within a society
9
Which scenario best illustrates the problem of cyclical unemployment?
A sales rep who was laid off during aneconomic downturn
A college graduate who turns down onejob and takes another
A landscaper who can’t find a job in thewinter
A factory worker whose skills are nolonger marketable
10
Which situation exists when tax revenues exceed government expenditures?
A budget deficit
A budget surplus
The government sells Treasury Bills
The Treasury prints more money
11
When Coca-Cola buys a shipment their secret ingredient it is considered to be
a nonmarket transaction.
an intermediate product.
a secondhand item.
a final sale.
12
Choose the correct letter on the graph that represents a recession.
Y
W
X
Z
13
Index of avg level of prices for approx. 90,000 goods and services in the economy is the ___
implicit GDP price deflator.
current GDP.
producer price index.
consumer price index.
14
On the graph below, what variable is represented by the gray line?
Government control and price stability.
An upward trend in prosperity over time.
The role of the Fed.
Wealth accumulation by the top 20%
15
A business fires 75% of their employees in '08 b/c of recession. Employees are ___ unemployed.
Structurally (structural)
Frictionally (frictional)
Not Counted as Unemployed
Cyclically (cyclical)
16
Which phase of the business cycle would the economy experience its lowest rate of unemployment?
peak
depression
trough
recession
17
Economists like to convert statistical series to real terms (i.e. real GDP) b/c the adjustment
removes the problem of unemployment.
removes the distortions caused by inflation.
makes the statistical series seem to grow faster.
is easy to do.
18
Compute the following
per capita
equation:
$40,000
$4,000
$4,400
$4.00
19
What is the relationship between personal level of education and future earnings potential?
Education has only a small influence
High levels of Education = high earnings potential
Education is totally unimportant
The majority of the “working poor” are highly-educated
20
GDP expressed in constant—or unadjusted for inflation—prices could also be referred to as
Nominal GDP
Aggregate Supply
Real GDP
Aggregate Demand
21
C + I + G + (X-M) - which letter represents the largest sector of the macroeconomy
C
G
X
I
22
Which of the following might cause the
inflation rate
to spike up sharply?
Consumer purchasing power decreases due to sluggisheconomy.
Price of items in the CPI “market basket” rise severely.
Moderate temperatures result in good harvests of soybeans.
Prices in world oil markets rise due to war in Middle East.
23
A person who cleans their own house takes part in
the underground economy
stimulating GDP
reducing GDP
nonmarket transaction
24
Which of the following would be counted in this year's GDP?
buying stocks
the sale of a new house
the purchase of a used car
fixing my own car
25
Which policy could the government try if America was trying to get the economy to
expand
?
cut production of consumer goods
cut taxes
cut government spending
cut prices of consumer goods
26
Read the following news clipping and select the resulting economic effect:
No change in aggregate demand and aggregate supply
Both aggregate demand and aggregate supply will decrease
Aggregate demand will increase, lowering both real GDP + CPI
Aggregate demand will decrease, raising the CPI + lower GDP
27
A nation’s imports for one year are worth $8.2 billion and its exports equal $8.3 billion:
A trade surplus, or a positive trade balance
A negative balance of payments
A trade deficit, or negative tradebalance
A positive balance of payments
28
You graduated from COLLEGE and are currently looking for your 1st job. You are ___ unemployed.
Frictionally (frictional)
Not Counted as Unemployed
Structurally (structural)
Cyclically (cyclical)
29
Nation imports more than it exports. Economists say that the nation has which of the following?
A trade deficit
A balance of trade
A trade surplus
A national debt
30
Which of the following is most likely to be affected by
high inflation
?
A factory worker
A doctor with a suburban practice
A retired grandmother on a fixed income
A shopkeeper
31
To be counted in the civilian labor force, a person must be
male and more than 18 years old.
female and a member of the military
employed or looking for work, and age 16 and over.
already employed and between the ages of 16 and 65.
32
If intermediate goods and services were included in GDP:
nominal GDP would exceed real GDP.
GDP would be understated.
GDP would have to be deflated for changes in price level.
GDP would be overstated.
33
The market value of all final goods & services produced in a country in a given period of time.
Gross National Product
Gross Dollar Prices
Gross Production Ratio
Gross Domestic Product
