Question 1

Computing the CPI is important because it provides ________.

Accepted Answer

A) a rough measure of the cost of living 
B) it is used as a benchmark in labor negotiations 
C) government uses it to index entitlements,such as social security benefits,so that beneficiaries do not lose purchasing power in periods of inflation 
D) all of the above 
E) none of the above 
A) a rough measure of the cost of living 
B) it is used as a benchmark in labor negotiations 
C) government uses it to index entitlements,such as social security benefits,so that beneficiaries do not lose purchasing power in periods of inflation 
D) all of the above 
E) none of the above

Question 2

Which of the following is included in the calculation of national income?

Accepted Answer

A) compensation of employees 
B) rental income 
C) indirect business taxes 
D) all of the above 
E) none of the above 
A) compensation of employees 
B) rental income 
C) indirect business taxes 
D) all of the above 
E) none of the above

Question 3

Which component of employee compensation has grown most rapidly in recent decades?

Accepted Answer

A) net interest income 
B) benefits 
C) transfer payments 
D) wages and salaries 
E) net factor income 
A) net interest income 
B) benefits 
C) transfer payments 
D) wages and salaries 
E) net factor income

Question 4

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

Accepted Answer

A) 14.6% 
B) 9.5% 
C) 9.9% 
D) 11.5% 
E) 16.5% 
A) 14.6% 
B) 9.5% 
C) 9.9% 
D) 11.5% 
E) 16.5%

Question 5

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

Accepted Answer

A) 59% 
B) 43.8% 
C) 66.7% 
D) 64.0% 
E) none of the above 
A) 59% 
B) 43.8% 
C) 66.7% 
D) 64.0% 
E) none of the above

Question 6

In a country with unusually high tax rates,one might expect that ________.

Accepted Answer

A) GDP might be overstated because the government might avoid running surpluses 
B) GDP might be understated because its citizens might avoid reporting some of their income 
C) GDP might be overstated because the government might raise its outlays 
D) GDP might be understated because its citizens might flee the country 
E) after tax income should be much higher than that of countries with lower tax rates 
A) GDP might be overstated because the government might avoid running surpluses 
B) GDP might be understated because its citizens might avoid reporting some of their income 
C) GDP might be overstated because the government might raise its outlays 
D) GDP might be understated because its citizens might flee the country 
E) after tax income should be much higher than that of countries with lower tax rates

Question 7

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

Accepted Answer

A) 8250 
B) 5000 
C) 7200 
D) 7500 
E) none of the above 
A) 8250 
B) 5000 
C) 7200 
D) 7500 
E) none of the above

Question 8

-Based on the table "Real and Nominal GDP," if year one is the base year,then the GDP deflator for year two is ________.

Accepted Answer

A) 95.5 
B) 123.5 
C) 118 
D) 104.7 
E) 116.6 
A) 95.5 
B) 123.5 
C) 118 
D) 104.7 
E) 116.6

Question 9

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

Accepted Answer

A) 66.7% 
B) 43.8% 
C) 59% 
D) 64.0% 
E) none of the above 
A) 66.7% 
B) 43.8% 
C) 59% 
D) 64.0% 
E) none of the above

Question 10

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?

Accepted Answer

Expenditures on public health are includ

Question 11

Computing the CPI is important because ________.

Accepted Answer

A) it is a very accurate and error-free measure of the cost of living 
B) it helps predict spending patterns for particular goods and services 
C) government uses it to index entitlements,such as social security benefits,so that beneficiaries do not lose purchasing power in periods of inflation 
D) all of the above 
E) none of the above 
A) it is a very accurate and error-free measure of the cost of living 
B) it helps predict spending patterns for particular goods and services 
C) government uses it to index entitlements,such as social security benefits,so that beneficiaries do not lose purchasing power in periods of inflation 
D) all of the above 
E) none of the above

Question 12

There are different interest rates associated with many types of securities.Which of the following statements is correct?

Accepted Answer

A) they vary depending on the liquidity of the security 
B) they vary depending on the risk associated with the security 
C) except in very unusual times,most interest rates move together 
D) all of the above 
E) none of the above 
A) they vary depending on the liquidity of the security 
B) they vary depending on the risk associated with the security 
C) except in very unusual times,most interest rates move together 
D) all of the above 
E) none of the above

Question 13

Real GDP =________ where the price level is the ________.

Accepted Answer

A) Nominal GDP × Price level;GDP deflator 
B) Nominal GDP ÷ Price level;GDP deflator 
C) Nominal GDP ÷ Price level;CPI 
D) Nominal GDP × Price level;CPI 
E) none of the above 
A) Nominal GDP × Price level;GDP deflator 
B) Nominal GDP ÷ Price level;GDP deflator 
C) Nominal GDP ÷ Price level;CPI 
D) Nominal GDP × Price level;CPI 
E) none of the above

Question 14

An international comparison of eight major industrialized countries reveals the following about the components of GDP: ________.

Accepted Answer

A) the U.S.has one of the largest shares of GDP going to investment 
B) the U.S.has one of the smallest government share of GDP 
C) the U.S.runs one of the largest trade deficits 
D) all of the above 
E) none of the above 
A) the U.S.has one of the largest shares of GDP going to investment 
B) the U.S.has one of the smallest government share of GDP 
C) the U.S.runs one of the largest trade deficits 
D) all of the above 
E) none of the above

Question 15

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?

Accepted Answer

The expected increase in the inflation r

Question 16

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 ________.

Accepted Answer

A) 157.1 million 
B) 144.8 million 
C) 245.6 million 
D) 100.8 million 
E) none of the above 
A) 157.1 million 
B) 144.8 million 
C) 245.6 million 
D) 100.8 million 
E) none of the above

Question 17

The income approach to measuring GDP involves adding up the following ________.

Accepted Answer

A) household income and income generated by firms 
B) private spending,tax revenues and government spending 
C) transfer payments and income taxes 
D) interest income,profits and social security benefits 
E) wages,benefits and interest income 
A) household income and income generated by firms 
B) private spending,tax revenues and government spending 
C) transfer payments and income taxes 
D) interest income,profits and social security benefits 
E) wages,benefits and interest income

Question 18

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

Accepted Answer

A) 8250 
B) 5900 
C) 7500 
D) 6775 
E) none of the above 
A) 8250 
B) 5900 
C) 7500 
D) 6775 
E) none of the above

Question 19

Examples of deflators are the ________ and ________ deflator

Accepted Answer

A) real;nominal 
B) private disposable income;gross national product 
C) personal consumption expenditure;gross domestic product 
D) gross domestic product;rental income 
E) private disposable income;personal consumption expenditure 
A) real;nominal 
B) private disposable income;gross national product 
C) personal consumption expenditure;gross domestic product 
D) gross domestic product;rental income 
E) private disposable income;personal consumption expenditure

Question 20

A discouraged worker might ________.

Accepted Answer

A) be counted as unemployed 
B) have tried to find a job during the month prior to the household survey,but without success 
C) have been prevented from working during the week prior to the household survey,due to illness or other temporary circumstances 
D) be waiting to return to a job from which he or she has been laid off 
E) none of the above 
A) be counted as unemployed 
B) have tried to find a job during the month prior to the household survey,but without success 
C) have been prevented from working during the week prior to the household survey,due to illness or other temporary circumstances 
D) be waiting to return to a job from which he or she has been laid off 
E) none of the above

Exam 2: Measuring Macroeconomic Data

Computing the CPI is important because it provides ________.

Which of the following is included in the calculation of national income?

Which component of employee compensation has grown most rapidly in recent decades?

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

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

In a country with unusually high tax rates,one might expect that ________.

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

-Based on the table "Real and Nominal GDP," if year one is the base year,then the GDP deflator for year two is ________.

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

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?

Computing the CPI is important because ________.

There are different interest rates associated with many types of securities.Which of the following statements is correct?

Real GDP =________ where the price level is the ________.

An international comparison of eight major industrialized countries reveals the following about the components of GDP: ________.

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 ________.

The income approach to measuring GDP involves adding up the following ________.

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

Examples of deflators are the ________ and ________ deflator

A discouraged worker might ________.

The Policy and Practice of Macroeconomics

Aggregate Production and Productivity

Saving and Investment in Closed and Open Economies

Money and Inflation

The Sources of Growth and the Solow Model

Drivers of Growth: Technology, policy, and Institutions

Business Cycles: an Introduction

The Is Curve

Monetary Policy and Aggregate Demand

Aggregate Supply and the Phillips Curve

The Aggregate Demand and Supply Model

Macroeconomic Policy and Aggregate Demand and Supply Analysis

The Financial System and Economic Growth

Financial Crises and the Economy

Fiscal Policy and the Government Budget

Exchange Rates and International Economic Policy

Consumption and Saving

Investment

The Labor Market, employment, and Unemployment

The Role of Expectations in Macroeconomic Policy

Modern Business Cycle Theory

Filters

Real GDP = where the price level is the .

Examples of deflators are the and deflator