Question 1. In 2004 the consumer price Index was equal to 163.8 and in 2003 it was equal to 157.5. What is the inflation rate over of this time period. (6.3%, 4.0% 3.85% or 10.1%).
Question 2. What is National saving equal to ?
A) household saving + business saving.
B) household saving + business saving+ government saving.
C) household saving + business saving net taxes - government purchase of goods and services .
D) Both B and C are correct.
Question 3. What is depreciation ?
A) the sum of gross and net investment.
B) Stock variable that effect the economy's ability to produce
C) The difference between gross investment and capital stock.
D) One of the flow variables affecting the capital stock.
Question 4. Suppose the nominal GDP per person is $17,000 in 2004, the 1998 GDP deflator is 100, and the 2004GDP deflator is 90. the approximate real GDP per person in 2004 is.
A) $17,000
B) $18,889
C) $32,300
D) $15,300
Question 5. Depreciation equals
A) capital minus gross investment
B) capital minus net investment
C) borrowing from the rest of the world only
D) national saving plus borrowing from the rest of the world
Question 6. Paying higher taxes means that our
A) Standing of living has decreased
B) Cost of living has increased
C) Cost of living has increased and our standard of living has increased
D) Standard of living has increased
Question 7. The unemployment rate
A) measure the percentage of people who want full time jobs, but can't find them.
B) measure the % of the working age populations who can't find a job.
C) measure the % of people in the labor force who can't find a job.
D) measure the % of the working age population that can't find a full time job.
Question 8. An increase in the price level decrease net imports, thereby decreasing the amount of real goods and services purchased in the United States. What is this phenomenon is know as.
A) The wealth effect, B) barter effect, C) substitution effect or D) GDP Effect
Question 9. Higer taxes:
A) increase aggregate demands
B) increase the aggregate quantity demanded
C) Decrease the aggregate quantity demanded
D) decrease aggregate demands
Question 10. People expect that the EL Nino effect will cause drought in Australia in the coming years If most firms expect their profit will fall during the next five years, Australia's ________ this year.
A) aggregate demands will increase
B) aggregate demands will decrease
C) long run aggregate supply will increase
D) Short run aggregate supply will increase
Question 11. The employment to population ratio is the ratio of the # of.
A) Unemployed people divided by the total population, the multiplied by 100
B) Employed people divided by the working age population, the multiplied by 100
C) Employed people divided by the total population, the multiplied by 100
D) Unemployed people divided by the working age population, the multiplied by 100
Question 12. Which one of the following most likely would decrease frictional unemployment?
A) An increase in the number of high school and college graduates.
B) Effective Internet-Base employment services and job registries.
C) An expansion of unemployment compensation benefits.
D) All of the above would decrease frictional unemployment.
Question 13. If the CPI was 132.5 at the end of 2003 and 140.2 at the end of 2004 the inflation rate over these 2 years was.
A) 7.7 %.
B) 5.4 %
C) 4.4%
D) 5.8%
Question 14. The unemployment rate generally falls during __________ in the business cycle
A) peak
B) recession
C) trough
D expansion