Question 1

A worker with two jobs is counted:

Accepted Answer

A) once in both the household and the establishment surveys. 
B) once in the household survey, but twice in the establishment survey. 
C) once in the establishment survey, but twice in the household survey. 
D) twice in both the household and the establishment surveys. 
A) once in both the household and the establishment surveys. 
B) once in the household survey, but twice in the establishment survey. 
C) once in the establishment survey, but twice in the household survey. 
D) twice in both the household and the establishment surveys. B

Question 2

All of the following actions are investments in the sense of the term used by macroeconomists except:

Accepted Answer

A) IBM's building a new factory. 
B) corner candy store's buying a new computer. 
C) John Smith's buying a newly constructed home. 
D) Sandra Santiago's buying 100 shares of IBM stock. 
A) IBM's building a new factory. 
B) corner candy store's buying a new computer. 
C) John Smith's buying a newly constructed home. 
D) Sandra Santiago's buying 100 shares of IBM stock. D

Question 3

The labor-force participation rate is the percentage of the:

Accepted Answer

A) adult population that is employed. 
B) adult population that is in the labor force. 
C) labor force that is employed. 
D) labor force that is unemployed. 
A) adult population that is employed. 
B) adult population that is in the labor force. 
C) labor force that is employed. 
D) labor force that is unemployed. B

Question 4

The CPI is determined by computing:

Accepted Answer

A) an average of prices of all goods and services. 
B) the price of a basket of goods and services that changes every year, relative to the same basket in a base year. 
C) the price of a fixed basket of goods and services, relative to the price of the same basket in a base year. 
D) nominal GDP relative to real GDP. 
A) an average of prices of all goods and services. 
B) the price of a basket of goods and services that changes every year, relative to the same basket in a base year. 
C) the price of a fixed basket of goods and services, relative to the price of the same basket in a base year. 
D) nominal GDP relative to real GDP.

Question 5

Assume that the market basket of goods and services purchased in 2004 by the average family in the United States costs $14,000 in 2004 prices, whereas the same basket costs $21,000 in 2009 prices. However, the basket of goods and services actually purchased by the average family in 2009 costs $20,000 in 2009 prices, whereas this same basket would have cost $15,000 in 2004 prices. Given these data, a Laspeyres price index of 2009 prices using 2004 as the base year would be:

Accepted Answer

A) 1.05. 
B) approximately 1.07. 
C) approximately 1.33. 
D) 1.50. 
A) 1.05. 
B) approximately 1.07. 
C) approximately 1.33. 
D) 1.50.

Question 6

GDP is all of the following except the total:

Accepted Answer

A) expenditure of everyone in the economy. 
B) income of everyone in the economy. 
C) expenditure on the economy's output of goods and services. 
D) output of the economy. 
A) expenditure of everyone in the economy. 
B) income of everyone in the economy. 
C) expenditure on the economy's output of goods and services. 
D) output of the economy.

Question 7

The number of households interviewed in the monthly employment survey of the U.S. Bureau of Labor Statistics is approximately:

Accepted Answer

A) 6,000. 
B) 60,000. 
C) 600,000. 
D) 6 million. 
A) 6,000. 
B) 60,000. 
C) 600,000. 
D) 6 million.

Question 8

Assume that a bakery hires more workers and pays them wages and that the workers produce more bread. GDP increases in all of the following cases except when the bread:

Accepted Answer

A) is sold to households. 
B) is stored away for later sale. 
C) grows stale and is thrown away. 
D) is sold to other firms. 
A) is sold to households. 
B) is stored away for later sale. 
C) grows stale and is thrown away. 
D) is sold to other firms.

Question 9

Two equivalent ways to view GDP are as the:

Accepted Answer

A) total payments made to all workers in the economy or the total profits of all firms and businesses in the economy. 
B) total expenditures on all goods produced in the economy or the total income earned from producing all services in the economy. 
C) total profits of all firms and businesses in the economy or the total consumption of goods and services by all households in the economy. 
D) total income of everyone in the economy or the total expenditure on the economy's output of goods and services. 
A) total payments made to all workers in the economy or the total profits of all firms and businesses in the economy. 
B) total expenditures on all goods produced in the economy or the total income earned from producing all services in the economy. 
C) total profits of all firms and businesses in the economy or the total consumption of goods and services by all households in the economy. 
D) total income of everyone in the economy or the total expenditure on the economy's output of goods and services.

Question 10

The best measure of the economic satisfaction of the members of a society is:

Accepted Answer

A) nominal GDP. 
B) real GDP. 
C) the rate of inflation. 
D) the value of corporate profits. 
A) nominal GDP. 
B) real GDP. 
C) the rate of inflation. 
D) the value of corporate profits.

Question 11

Measuring the rate of inflation using a market basket that excludes food and energy prices is preferred by some analysts because this measure, called core inflation,:

Accepted Answer

A) provides a real, rather than a nominal, rate of inflation. 
B) gives a better measure of ongoing, sustained price changes. 
C) is more consistent with measures of inflation used in other countries. 
D) fluctuates more than measures of inflation that include food and energy prices. 
A) provides a real, rather than a nominal, rate of inflation. 
B) gives a better measure of ongoing, sustained price changes. 
C) is more consistent with measures of inflation used in other countries. 
D) fluctuates more than measures of inflation that include food and energy prices.

Question 12

If real GDP grew by 6 percent and population grew by 2 percent, then real GDP per person grew by approximately percent.

Accepted Answer

A) 2 
B) 3 
C) 4 
D) 8 
A) 2 
B) 3 
C) 4 
D) 8

Question 13

An example of an imputed value in the GDP is the:

Accepted Answer

A) value-added of meals cooked at home. 
B) housing services enjoyed by homeowners. 
C) services of automobiles to their owners. 
D) value of illegal drugs sold. 
A) value-added of meals cooked at home. 
B) housing services enjoyed by homeowners. 
C) services of automobiles to their owners. 
D) value of illegal drugs sold.

Question 14

In 2009, the GDP of the United States totaled about:

Accepted Answer

A) $14 billion. 
B) $140 billion. 
C) $14 trillion. 
D) $140 trillion. 
A) $14 billion. 
B) $140 billion. 
C) $14 trillion. 
D) $140 trillion.

Question 15

The amount of capital in an economy is a and the amount of investment is a .

Accepted Answer

A) flow; stock 
B) stock; flow 
C) final good; intermediate good 
D) intermediate good; final good 
A) flow; stock 
B) stock; flow 
C) final good; intermediate good 
D) intermediate good; final good

Question 16

Real GDP per capita is an imperfect measure of economic well-being because it does not value home production nor production in the underground economy, among other factors. Give at least two examples that show why the omission of these types of items will make a difference in evaluating economic well being. One example should explain how the omissions distort comparisons of economic well being across countries and the other example should explain how the omission distorts comparisons of economic well being in the same
country over time.

Accepted Answer

Answers will vary, but one example could

Question 17

The GDP deflator is equal to:

Accepted Answer

A) the ratio of nominal GDP to real GDP. 
B) the ratio of real GDP to nominal GDP. 
C) real GDP minus national GDP. 
D) nominal GDP minus real GDP. 
A) the ratio of nominal GDP to real GDP. 
B) the ratio of real GDP to nominal GDP. 
C) real GDP minus national GDP. 
D) nominal GDP minus real GDP.

Question 18

In the United States since the end of World War II:

Accepted Answer

A) the labor force participation rates of both men and women have increased. 
B) the labor force participation rates of both men and women have decreased. 
C) the labor force participation rate of men has increased, while the labor force participation of women has decreased. 
D) the labor force participation rate of men has decreased, while the labor force participation rate of women has increased. 
A) the labor force participation rates of both men and women have increased. 
B) the labor force participation rates of both men and women have decreased. 
C) the labor force participation rate of men has increased, while the labor force participation of women has decreased. 
D) the labor force participation rate of men has decreased, while the labor force participation rate of women has increased.

Question 19

If an increasing proportion of the adult population is retired, then the labor force participation rate:

Accepted Answer

A) will increase. 
B) will decrease. 
C) will remain constant. 
D) may increase, decrease, or remain constant. 
A) will increase. 
B) will decrease. 
C) will remain constant. 
D) may increase, decrease, or remain constant.

Question 20

The investment component of GDP includes all of the following except:

Accepted Answer

A) purchases of corporate stock. 
B) spending on new plants and equipment. 
C) purchases of new housing by households. 
D) changes in business inventories. 
A) purchases of corporate stock. 
B) spending on new plants and equipment. 
C) purchases of new housing by households. 
D) changes in business inventories.

A worker with two jobs is counted:

All of the following actions are investments in the sense of the term used by macroeconomists except:

The labor-force participation rate is the percentage of the:

The CPI is determined by computing:

GDP is all of the following except the total:

The number of households interviewed in the monthly employment survey of the U.S. Bureau of Labor Statistics is approximately:

Assume that a bakery hires more workers and pays them wages and that the workers produce more bread. GDP increases in all of the following cases except when the bread:

Two equivalent ways to view GDP are as the:

The best measure of the economic satisfaction of the members of a society is:

Measuring the rate of inflation using a market basket that excludes food and energy prices is preferred by some analysts because this measure, called core inflation,:

If real GDP grew by 6 percent and population grew by 2 percent, then real GDP per person grew by approximately percent.

An example of an imputed value in the GDP is the:

In 2009, the GDP of the United States totaled about:

The amount of capital in an economy is a and the amount of investment is a .

The GDP deflator is equal to:

In the United States since the end of World War II:

If an increasing proportion of the adult population is retired, then the labor force participation rate:

The investment component of GDP includes all of the following except:

The Science of Macroeconomics

National Income: Where It Comes From and Where It Goes

Money and Inflation

The Open Economy

Unemployment

Economic Growth I: Capital Accumulation and Population Growth

Economic Growth II: Technology, Empirics, and Policy

Introduction to Economic Fluctuations

Aggregate Demand I: Building the Is-Lm Model

Aggregate Demand II: Applying the Is-Lm Model

Aggregate Supply and the Short-Run Tradeoff Between Inflation and Unemployment

Stabilization Policy

Government Debt and Budget Deficits

Introduction to the Financial System

Asset Prices and Interest Rates

Securities Markets

Banking

Financial Crises

Filters

Exam 2: The Data of Macroeconomics

A worker with two jobs is counted:

All of the following actions are investments in the sense of the term used by macroeconomists except:

The labor-force participation rate is the percentage of the:

The CPI is determined by computing:

GDP is all of the following except the total:

The number of households interviewed in the monthly employment survey of the U.S. Bureau of Labor Statistics is approximately:

Assume that a bakery hires more workers and pays them wages and that the workers produce more bread. GDP increases in all of the following cases except when the bread:

Two equivalent ways to view GDP are as the:

The best measure of the economic satisfaction of the members of a society is:

Measuring the rate of inflation using a market basket that excludes food and energy prices is preferred by some analysts because this measure, called core inflation,:

If real GDP grew by 6 percent and population grew by 2 percent, then real GDP per person grew by approximately percent.

An example of an imputed value in the GDP is the:

In 2009, the GDP of the United States totaled about:

The amount of capital in an economy is a and the amount of investment is a .

The GDP deflator is equal to:

In the United States since the end of World War II:

If an increasing proportion of the adult population is retired, then the labor force participation rate:

The investment component of GDP includes all of the following except:

The Science of Macroeconomics

National Income: Where It Comes From and Where It Goes

Money and Inflation

The Open Economy

Unemployment

Economic Growth I: Capital Accumulation and Population Growth

Economic Growth II: Technology, Empirics, and Policy

Introduction to Economic Fluctuations

Aggregate Demand I: Building the Is-Lm Model

Aggregate Demand II: Applying the Is-Lm Model

Aggregate Supply and the Short-Run Tradeoff Between Inflation and Unemployment

Stabilization Policy

Government Debt and Budget Deficits

Introduction to the Financial System

Asset Prices and Interest Rates

Securities Markets

Banking

Financial Crises

Filters