Macroeconomics > EXAM > MACROECONOMICS EXAM 2/100% ACCURATE (All)

MACROECONOMICS EXAM 2/100% ACCURATE

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Which of the following would not affect this year's GDP? - ANS -the value of a used car you purchased, at its sale price Which of the following activities is not counted in our calculations of GDP?... - ANS -the labor services of a volunteer group building a home for a poor widow If Honda (a Japan-based firm) produces a car in Ohio and exports it to Japan, in which country's GDP will the car be counted? - ANS -The GDP of the United States because that is where it was built Suppose the consumer price index (CPI) for Year X is 130. This means the average price of goods and services is - ANS -priced at 30 percent more in Year X than in the base year. If nominal GDP increases 4 percent during a year, and real GDP increases 7 percent during the same year, which of the following must by true? - ANS -The general level of prices as measured by the GDP deflator decreased by approximately 3 percent during the year. If the consumer price index (CPI) at the end of year one was 100 and was 108 at the end of year two, the inflation rate during year two was - ANS -8 percent. If nominal GDP rises from one year to the next, then - ANS -either output, or the general level of prices, or both must be rising. Because of transactions which take place in the underground economy, the - ANS -GDP calculation tends to understate the actual value of goods sold in the economy. In recent years, people have benefited from greater amounts of leisure time. This trend - ANS -is not accounted for in GDP. The recessionary phase of the business cycle is characterized by - ANS -decreasing real output and increasing unemployment. Maurice loses his job and decides to sit on the beach rather than looking for work the next few months. Other things the same, the unemployment rate - ANS -increases, and the labor-force participation rate decreases. Consider an economy made up of 100 people, 60 of whom hold jobs, 10 of whom are looking for work, and 15 of whom are retired. The number counted as unemployed is - ANS -10. If the labor force grows at a faster rate than the number employed, the - ANS -unemployment rate will rise. [Show More]

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