Exam 2: Measuring Macroeconomic Data

In the 1970s,nominal interest rates in the United States were quite high,while real rates were extremely low.Which group "wins" in this circumstance,lenders or borrowers? What might explain the willingness of the "losers" to accept disadvantageous loan terms?

An increase in the actual rate of inflation is most likely to cause a decrease in ________.

State the fundamental identity of national income accounting.Why is it not possible for this identity to be violated?

Figure 2.5 Unemployment in the adult civilian population,2013 -According to Figure 2.5,the United States civilian labor force in June 2013 was ________.

To avoid double counting in the calculation of GDP,which types of goods are typically excluded from the calculation?

All income,production,and expenditure variables that are measured at current market prices are referred to as ________.

A small business owner has a line of credit from a bank with a nominal interest rate of seven percent.For several years,the price level has been rising at an annual rate of two percent,but the owner has just read in the newspaper that economists expect next year's inflation rate to be four percent or more.Assume that this owner may either continue the line of credit at seven percent,or renegotiate to alter both the size of the credit and the interest rate.What reason might there be for the owner to keep the credit terms as is? What argument might justify changing the credit agreement?

The Federal Funds Rate is ________.

In relatively poor economies,modest expenditures on public health (immunization of children)can produce large improvements.What does this imply about the accuracy of the growth rate of real GDP as a measure of national well-being? How is the situation different in rich economies?

Private disposable income equals GDP ________.

Assume that a high proportion of recent college graduates decides to stay in school seeking advanced degrees,rather than confront the challenge of landing a good job in the midst of generally high unemployment.What is the direct impact of this behavior on (a)the labor force participation rate,(b)the employment ratio,and (c)the unemployment rate?

Figure 2.5 Unemployment in the adult civilian population,2013 -According to Figure 2.5,the United States civilian unemployment rate in June 2013 was ________.

To compute the CPI,the Bureau of Labor Statistics (BLS)compiles a "basket of goods" that ________;each price in the index is weighted by ________.

A discouraged worker might ________.

The unemployment rate that is typically reported in the media is ________.

The Bureau of Economic Analysis calculates the PCE deflator ________.

Computing the CPI is important because ________.

The unemployment rate that is typically reported in the media is ________.

The inflation rate can be obtained by ________.

Real and Nominal GDP -Based on the table "Real and Nominal GDP," if year one is the base year,then the inflation rate in year three is ________.