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Question

1
A)
Which of the following goods would be included in the calculation of gross domestic product?Select the two correct answers.
(1 point)
Notebooks sold to students.
Steel sold to an automobile manufacturer.
Lumber sold to construction firms.
French fries sold to customers at a restaurant.
Chemicals sold to pharmaceutical developers.
Question
2
A)
Use the table to answer the question.
Consumption
$
2
,
000
Investment
$
1
,
000
Government Spending
$
1
,
000
Imports
$
500
Exports
$
600
The market value for each type of expenditure is given for a hypothetical country in the tableabove. Calculate the gross domestic product of this country.
(1 point)
$4, 100
$5, 100
$4, 000
$3, 900
Question
3
Question
4
A)
Which of the following would be counted in the investment component of this year's GDP?
(1 point)
The market value of new factories built this year.
The market value of all finished goods purchased this year.
The market value of all concrete sold this year.
The total quantity of savings account deposits made this year.
A)
If a country is maintaining a healthy amount of growth, which of the following accuratelydescribes the behavior of real GDP over time?
(1 point)
Real GDP fluctuates but follows a downward-sloping trend line.
Real GDP fluctuates but follows an upward-sloping trend line.
Real GDP fluctuates but follows a horizontal trend line.
Real GDP does not fluctuate if growth is occurring.
Question
5
Question
6
A)
Use the table to answer the question.
2007
2008
Price ($)
Quantity
Price ($)
Quantity
Video Games
60
100
60
200
Movies
15
20
12
50
The table above gives the prices and quantities for a fictional country that only produces videogames and movies. What is the growth rate of Nominal GDP from 2007 to 2008?
(1 point)
12, 600
200%
6, 300
100%
A)
Given a GDP deflator of 120 and a Nominal GDP of 7.8 billion dollars, calculate Real GDP.
(1 point)
9 billion dollars
6.6 billion dollars
6.5 billion dollars
9.36 billion dollars
Question 7
Unemployment resulting from
mismatches between employer needs
and employee skills.
Unemployment associated with the highs
and lows of the business cycle.
Unemployment associated with workers
who are between jobs.
A) Match each type of employment with its definition. (2 points)
 cyclical unemployment  structural unemployment  frictional unemployment
Question
8
A)
Use the table to answer the question.
Total Population
1,000
Total Population Over 16 Years of Age
800
Total Labor Force
600
Total Employment
500
The table above gives population and employment numbers for a hypothetical country. What is theunemployment rate in this country? Round your answer to the nearest whole percent if necessary.
(1 point)
17%
10%
83%
20%
Question
9
Question
10
A)
Which debts can be discharged in Chapter 7 bankruptcy? Select the two correct answers.
(1 point)
Credit card debt
Car repair bills
Tax debts
Student loans
Medical bills
A)
The CPI of a country in October is given to be 210. In November, the CPI rises to 220. What isthe rate of inflation from October to November? Round your answer to the nearest tenth of apercent if necessary.
(1 point)
4.5%
10.0%
4.8%
1.0%
Question
11
Question
12
A)
Which of the following will likely lead to cost-push inflation? Select the two correct answers.
(1 point)
An ongoing war causes government spending to nearly double in quantity.
An increase in the price of oil has reduced supply of all goods and services that use oil as an input.
Exports increase dramatically after a relative drop in price.
Consumers become more comfortable with debt, increasing their spending as they take on more
loans.
A tornado destroys factories and lowers supply levels throughout the economy.
Official Poverty Measure
Supplemental Poverty Measure
Both
clothing costs
utilities costs
housing costs
food costs
A)
Indicate whether each of the following is used in the calculation of the official poverty measure,the Supplemental Poverty Measure, or both.
(2 points)
Question
13
Question
14
A)
Which of the following policies might a government use to redistribute income from high-incomeearners to low-income earners?
(1 point)
negative income tax
prescription drug coverage
food stamps
free and reduced school lunches
A)
Which of the following illustrate improvements in productivity? Select the two correct answers.
(1 point)
After adopting a new typing strategy, a data scientist is able to provide more data services to clients.
After practicing at home, a dishwasher has doubled the number of dishes he can wash in a single
shift.
A nurse decides to work overtime, increasing the quantity of patient care services she is able to
provide.
A restaurant purchases more food ingredients, resulting in a larger quantity of meals available to
customers.
After hiring an additional employee, a factory manager has seen a large increase in factory output.
Question
15
A)
Which of the following represents an increase in labor productivity within a country?
(1 point)
GDP increased from 200 billion dollars to 400 billion dollars, while total labor hours increased from
50 million to 75 million.
GDP decreased from 400 billion dollars to 200 billion dollars, while total labor hours decreased from
100 million to 50 million.
GDP increased from 200 billion dollars to 400 billion while total labor hours increased from 50 million
to 100 million.
GDP decreased from 400 billion dollars to 200 billion dollars while total labor hours decreased from
75 million year to 50 million.
Question
16
A)
What are the causes of a recession? What happens to a county's output and prices after arecession has ended? Write 3-5 sentences.
(4 points)
    
Short Answer Rubric (4 points)
PointsAwarded
Criteria
4
The answer is very clear.
The answer is fully supported by details.
There may be a few errors in grammar, usage, or mechanics. Errors do not interfere withmeaning.
3
The answer is mostly clear.
The answer is supported by mostly relevant details.
There are a few errors in grammar, usage, or mechanics. Errors do not interfere withmeaning.
2
The answer is somewhat clear.
Details are weak or not related.
There are some errors in grammar, usage, and mechanics. Errors interfere with meaning.
1
The answer is not clear.
There are few or no supporting details.
There are many errors in grammar, usage, and mechanics. Errors interfere with meaning.
0
The question is not answered.
Question
17
A)
Explain the three main types of unemployment experienced within an economy. Provide atleast one example demonstrating each type of unemployment.
(4 points)
    
Short Answer Rubric (4 points)
PointsAwarded
Criteria
4
The answer is very clear.
The answer is fully supported by details.
There may be a few errors in grammar, usage, or mechanics. Errors do not interfere withmeaning.
3
The answer is mostly clear.
The answer is supported by mostly relevant details.
There are a few errors in grammar, usage, or mechanics. Errors do not interfere withmeaning.
2
The answer is somewhat clear.
Details are weak or not related.
There are some errors in grammar, usage, and mechanics. Errors interfere with meaning.
1
The answer is not clear.
There are few or no supporting details.
There are many errors in grammar, usage, and mechanics. Errors interfere with meaning.
0
The question is not answered.
Question
18
A)
In one to two sentences, give an example that shows how technology has made infrastructuremore advanced, and include one possible disadvantage associated with advanced infrastructure.
(2 points)
    
Short Answer Rubric (2 points)
PointsAwarded
Criteria
2
The answer is very clear.
The answer is fully supported by details.
There may be a few errors in grammar, usage, or mechanics. Errors do not interfere withmeaning.
1
The answer is somewhat clear.
Details are weak or not related.
There are some errors in grammar, usage, and mechanics. Errors interfere with meaning.
0
The question is not answered.
Question
19
A)
How do improvements in technology and human capital influence productivity, economicgrowth, and standard of living within an economy?
(2 points)
    
Short Answer Rubric (2 points)
PointsAwarded
Criteria
2
The answer is very clear.
The answer is fully supported by details.
There may be a few errors in grammar, usage, or mechanics. Errors do not interfere withmeaning.
1
The answer is somewhat clear.
Details are weak or not related.
There are some errors in grammar, usage, and mechanics. Errors interfere with meaning.
0
The question is not answered.
Question
20
A)
In one to two sentences, explain how a corporation can use people who save money for capitalformation or growth.
(2 points)
    
Short Answer Rubric (2 points)
PointsAwarded
Criteria
2
The answer is very clear.
The answer is fully supported by details.
There may be a few errors in grammar, usage, or mechanics. Errors do not interfere withmeaning.
1
The answer is somewhat clear.
Details are weak or not related.
There are some errors in grammar, usage, and mechanics. Errors interfere with meaning.
0
The question is not answered.

1 answer

Answers

Question 1:

  • A) Which of the following goods would be included in the calculation of gross domestic product? Select the two correct answers.
    • French fries sold to customers at a restaurant.
    • Steel sold to an automobile manufacturer. (Notebooks and lumber are intermediate goods and are not included in GDP calculation directly.)

Question 2:

  • A) Calculate the gross domestic product of this country.
    • $4,100
    • Calculation:
      • \( GDP = C + I + G + (X - M) \)
      • \( GDP = 2000 + 1000 + 1000 + (600 - 500) = 2000 + 1000 + 1000 + 100 = 4100 \)

Question 3:

  • A) Which of the following would be counted in the investment component of this year's GDP?
    • The market value of new factories built this year.

Question 4:

  • A) If a country is maintaining a healthy amount of growth, which of the following accurately describes the behavior of real GDP over time?
    • Real GDP fluctuates but follows an upward-sloping trend line.

Question 5:

  • A) What is the growth rate of Nominal GDP from 2007 to 2008?
    • 200%
    • Calculation:
      • 2007 GDP = (60 * 100) + (15 * 20) = 6000 + 300 = 6300
      • 2008 GDP = (60 * 200) + (12 * 50) = 12000 + 600 = 12600
      • Growth Rate = \( \frac{12600 - 6300}{6300} \times 100 = 100% \).

Question 6:

  • A) Given a GDP deflator of 120 and a Nominal GDP of 7.8 billion dollars, calculate Real GDP.
    • 6.5 billion dollars
    • Formula: \( \text{Real GDP} = \frac{\text{Nominal GDP}}{\text{GDP deflator}} \times 100 \)
    • Calculation: \( \frac{7.8 \text{ billion}}{120} \times 100 = 6.5 \text{ billion} \).

Question 7:

  • Match each type of unemployment with its definition:
    • Cyclical unemployment: Unemployment associated with the highs and lows of the business cycle.
    • Structural unemployment: Unemployment resulting from mismatches between employer needs and employee skills.
    • Frictional unemployment: Unemployment associated with workers who are between jobs.

Question 8:

  • A) What is the unemployment rate in this country?
    • 17%
    • Calculation: \( \text{Unemployment Rate} = \frac{\text{Unemployed}}{\text{Total Labor Force}} \times 100 = \frac{100}{600} \times 100 = 16.67% \), which rounds to 17%.

Question 9:

  • A) Which debts can be discharged in Chapter 7 bankruptcy? Select the two correct answers.
    • Credit card debt
    • Medical bills

Question 10:

  • A) What is the rate of inflation from October to November?
    • 4.8%
    • Calculation: \( \text{Inflation Rate} = \frac{CPI_{Nov} - CPI_{Oct}}{CPI_{Oct}} \times 100 = \frac{220 - 210}{210} \times 100 \approx 4.76% \), which rounds to about 4.8%.

Question 11:

  • A) Which of the following will likely lead to cost-push inflation?
    • An increase in the price of oil has reduced supply of all goods and services that use oil as an input.
    • A tornado destroys factories and lowers supply levels throughout the economy.

Question 12:

  • Indicate whether each of the following is used in the calculation of the official poverty measure, the Supplemental Poverty Measure, or both.
    • Both: Housing costs, food costs.
    • Official Poverty Measure: Clothing costs.
    • Supplemental Poverty Measure: Utilities costs.

Question 13:

  • A) Which of the following policies might a government use to redistribute income from high-income earners to low-income earners?
    • Negative income tax
    • Food stamps

Question 14:

  • A) Which of the following illustrate improvements in productivity?
    • After adopting a new typing strategy, a data scientist is able to provide more data services to clients.
    • After practicing at home, a dishwasher has doubled the number of dishes he can wash in a single shift.

Question 15:

  • A) Which of the following represents an increase in labor productivity within a country?
    • GDP increased from 200 billion dollars to 400 billion dollars, while total labor hours increased from 50 million to 75 million. (Labor productivity is GDP per hour worked).

Question 16:

  • A) What are the causes of a recession? What happens to a country's output and prices after a recession has ended?
    • A recession is often caused by a decrease in consumer and business confidence, which leads to reduced spending and investment. After a recession ends, a country's output typically increases as demand picks up, but prices may remain stable or even decline as businesses attempt to regain market share.

Question 17:

  • A) Explain the three main types of unemployment experienced within an economy. Provide at least one example demonstrating each type of unemployment.
    • Cyclical unemployment occurs during downturns in the economy when businesses lay off workers (e.g., during a recession). Structural unemployment happens when workers' skills do not match job requirements (e.g., a coal miner unable to find work in a renewable energy economy). Frictional unemployment is when individuals are temporarily unemployed while transitioning between jobs (e.g., a recent graduate looking for a first job).

Question 18:

  • A) How has technology made infrastructure more advanced, and what is one possible disadvantage?
    • Technology has led to the development of smart traffic systems that optimize the flow of vehicles in real time. However, a possible disadvantage is that these systems can be vulnerable to cyberattacks, which could disrupt infrastructure functionality.

Question 19:

  • A) How do improvements in technology and human capital influence productivity, economic growth, and standard of living within an economy?
    • Improvements in technology lead to more efficient production methods, increasing productivity and driving economic growth. As economies grow, higher productivity often translates into better wages and living standards for individuals.

Question 20:

  • A) In one to two sentences, explain how a corporation can use people who save money for capital formation or growth.
    • Corporations can raise funds for growth by encouraging savings through financial instruments such as stocks or bonds, allowing individuals to invest their savings in the company. This capital can then be used for expansion, research, and development initiatives that drive further growth.