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Measuring the Economy
Who is this?
Which is a cause of inflation?
Measuring the Economy
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Econ exam review
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Answers
1
Which is a cause of inflation?
costs of production rise, so producers have to raise prices
consumer demand decreases & the law of demand is not obeyed
inventories grow & there's a surplus of goods & services
the $ supply is tightened, so there's less $ in circulation
2
Who is this?
Jean Luc Picard
Charles Xavier
Gurney Halleck
MacBeth
3
Keith lost his job at the switchboard because automated phone systems were installed.
seasonal unemployment
structural unemployment
frictional unemployment
cyclical unemployment
4
Official unemployment rates may be understated because they ignore _____.
senior citizens
workers in illegal or informal economies
parents who don't want jobs
discouraged workers
5
Cereal is soup
True
False
6
Sarah is laid off from her part-time job at the ski resort when the snow melts. Sarah is ____.
seasonally unemployed
structurally unemployed
frictionally unemployed
cyclically unemployed
7
A decline in real economic activity over a period of at least six months is called a ________.
declination
depression
recession
panic
8
Randy had a mid-life crisis, quit his job, & is pursuing a job in the circus on a trapeze .
a discouraged worker
frictionally unemployed
structurally unemployed
employed
9
Which is most often used to assess standard of living?
unemployment rate
stagflation
gross domestic product
inflation
10
Why are final goods included in the calculation of GDP & intermediate goods are not?
final goods already include the value of intermediate goods
intermediate goods are not as popular as final goods
Intermediate goods include the value of final goods
final goods are not as popular as intermediate goods
11
Unexpected inflation will have the biggest impact on people who ___________.
have money in the stock market
have entry-level jobs
live on a fixed income
have fixed-rate loans
12
When the economy is working properly, what is the unemployment rate?
10-12%
4-6%
1-3%
8-10%
13
Which of the following is unemployed?
a man who is not working, but has an interview next week
a 15-year-old boy
a stay-at-home mom
a woman who isn't working and gave up looking for a job
14
Which is not one of the sectors used to calculate GDP?
foreign investment
exports
business investment
imports
15
Which are included in calculating GDP?
grains used to produce Cheerios
toys made in China at a factory owned by a US company
a laptop computer purchased at Best Buy
the sale of a 25-year-old house
16
Which of the following most accurately describes how inflation affects purchasing power?
Inflation does not affect purchasing power
Inflation causes purchasing power to decrease
Inflation causes purchasing power to increase
Inflation causes purchasing power to increase then decrease
17
The difference between real and nominal GDP is that real GDP is adjusted for ________.
unemployment
entitlements
inflation
international trade
18
Why is the unemployment rate above zero when the economy reaches full employment?
There are never enough jobs
Most workers do not have enough training for the best jobs
Most jobs lay off workers while the economy is slow
There are always some people transitioning between jobs
19
Which would occur during the expansion phase of the business cycle?
increasing unemployment and declining GDP
decreasing GDP and deflation
falling inflation and falling employment
increasing GDP and decreasing unemployment
20
Zimbabwe continued to print more and more money which led to ______________.
stagflation
creeping inflation
deflation
hyperinflation
21
Deflation is good for __________.
business
no one
consumers
borrowers
22
In which phase of the business cycle will you likely see high unemployment?
expansion
peak
all of the above
contraction
