Economics Exam 2 – Flashcards

List and define the 4 components of nominal GDP:

What is consumption (C)?

What is investment (Ig)?

What is government spending (G)?

what are Net Exports (NX)

Define Nominal GDP:

define unemployment

define recession:

define savings

define investment

define inventory

macroeconomics studies what two things?

macroeconomics focuses on 3 key economic statistics

macroeconomics is mostly focused on...

the business cycle depicts:

the term "recession" describes a situation where:

this is most closely related to a recession

which of the following statements is most accurate about advanced economies? A.economies experience a positive growth trend over the short run, but experience significant variability in the long run. B.economies experience a positive growth trend over the long run, but experience significant variability in the short run C. economies experience positive and stable growth over both the long run and short run

Real GDP measures the:

if the prices of all goods and services rose, but the quantity produced remained unchanged, what would happen to nominal and real GDP?

Real GDP is preferred to nominal GDP as a measure of economic performance because

Elias pizza parlor produced 10,000 large pizzas last year that sold for $10 each. This year Elias pizza parlor produced 10,000 large pizzas, but sold them for $12 each. based on this information we can conclude that Elias's production of large pizzas: A. increased both nominal and real GDP B.increased nominal GDP from last year, but real GDP was unaffected C.increased real GDP form last year, but nominal GDP was unaffected Based on this information we can conclude that Elias's production of large pizzas this year increased nominal GDP by 20,000, but left real GDP unchanged. True or false?

Why are high rates of unemployment of concern to economists?

higher rates of unemployment are linked with:

why are economist concerned about inflation?

modern economic growth refers to countries that have experienced an increase in:

before the period of modern economic growth

which of the following statements best describes how firms respond to demand shocks under conditions of inflexible prices? A. firms respond to shorter term demand shocks by adjusting production levels;more persistent changes in demand result in changes in inventories B.Firms responds to shorter term demand shocks by adjusting inventories; more persistent changes in demand result in changes in production levels.

what are the methods to calculate GDP and which of these is the primary calculation method?

define intermediate goods

define final goods

define value added

define price index

define market basket

GDP fails to account for which of the following

a consumer price index attempts to measure changes in

The agency responsible for compiling the National Income Product Accounts for the U.S.

The system that measures the economy's overall performance is formally known as:

Suppose Elias pays $100 to Reyna A.We can say with certainty that the nominal GDP has increased, but we cant say whether real GDP has increased or decreased B. We can say with certainty that GDP has increased by $100 C. We need more information to determine wheter GDP has changed.

Goods and services sold are not GDP. True or false?

Final goods and services refer to:

suppose the total monetary value of all final goods and services produced in a particular country in 2010 is $500 billion and the total monetary value of final goods and services sold is $450. We can conclude that the GDP in 2010...

The GDP would be overstated if _______ goods and services were included in GDP

Which of the following transactions would be included in GDP? A. Olivia receives a tax refund of $500 B.Elias buys $5000 worth of stock in Microsoft C. Reyna buys a newly constructed house

Net exports are negative when...

if depreciation (consumption of fixed capital) exceeds gross domestic investment, we can conclude that:

The smallest component of aggregate spending in the US is:

When calculating GDP are governmental transfer payment, such as social security or unemployment compensation counted?

The largest component of total expenditures in the US is

In national income accounting , government purchases include:

nominal GDP is:

Real GDP refers to:

Nominal GDP is adjusted for price changes through the use of:

A price index is?

what is the real GDP per capita (per person) formula?

What is the formula for growth rate per real GDP?

What is the formula per GDP per capital

What is the rule of 70?

Define economic growth.

What are the 7 institutional structures that promote growth?

List the 4 phases of the business cycle:

List the 5 current characteristics of a Recession:

Define "recession" using the Original, "Old" Way:

What are the three types of unemployment?

What is frictional unemployment?

What is structural unemployment?

What is cyclical unemployment?

List the 3 characteristics which the BLS requires to be included as "In the Labor Force":

What is full employment?

What is a depression?

Define "Natural Rate of Unemployment":

What is Okun's Law?

What is inflation?

What is deflation?

Define Consumer Price Index:

What are the 2 types of Inflation?

What is Demand-Pull Inflation?

What is Cost-Push Inflation?

Define "Cost of Living Allowance":

What is hyperinflation?

Real GDP per capita is found by?

Real GDP per captia can...?

Which of the following best measures improvements in the standard of living of a nation?

If a nationals real GDP increases from 100 billion to 106 billion and its population jumps from 200 million to 212 million, its real GDP per capita will?

For a nation's real GDP per captia to rise during a year:

the numbers of years required for real GDP to double can be found by:

The industrial Revolution and modern economic growth resulted in:

Economic growth can be portrayed as:

Economic decline can be portrayed as:

Suppose that an economy's labor productivity fell by 3% and its total worker-hours remained constant between year 1 and year 2. We could conclude that this economy's:

In the United States, business cycles have occurred against a backdrop of a long-run trend of:

The industries or sectors of the economy in which business cycle fluctuations tend to affect output most are...?

The phase of the business cycle in which real GDP declines is called?

The phase of the business cycle in which the real GDP is at a minimum is called?

The phase of the business cycle in which the real GDP is at a temporary maximum is called?

The phase of the business cycle in which real GDP in which income and employment rise is called?

In which phase of the business cycle will the economy most likely experience rising real output and falling unemployment rates?

What is the primary reason that changes in total spending lead to cyclical changes in output and employment?

The economy of Jackistan has a total population of 145 million people, of which 95 million are employed, 7 million are unemployed, and 3 million are discouraged workers. The labor force in Jackistan is?

The economy of Jackistan has a total population of 145 million people, of which 95 million are employed, 7 million are unemployed, and 3 million are discouraged workers. The unemployment rate in Jackistan is?

The economy of Jackistan has a total population of 145 million people, of which 95 million are employed, 7 million are unemployed, and 3 million are discouraged workers. If the natural rate of unemployment in Jackistan is 5%, then:

The United States' economy is considered to be at full employment when:

Bob voluntarily quit his job as an insurance agent to return to school full-time to earn a MBA degree. With the degree in his hand, he is now searching for a position in management. Bob is presently?

The labor force includes:

Alex works in her home as a homemaker and full-time caretaker of his children. Officially he is:

official unemployment statistics understate unemployment because...

Assuming the total population is 100 million, the civilian labor force is 50 million, and 47 million workers are employed, the unemployment rate is:

Suppose there are 5 million unemployed workers seeking jobs. After a period of time, 1 million of them become discouraged over their job prospects and ceases to look for work. As a result of this, all else equal, the official unemployment rate would increase. true or false?

In the depth of the Great Depression, the unemployment rate in the United States was about:

The GDP gap measure the difference between

A large negative GDP gap implies

if potential GDP is $400 billion and there is a negative GDP gap of $15 billion, real GDP is:

what is Okuns Law

if the consumer price index falls from 120 to 116 in a particular year, the economy has experienced:

The consumer price index was 177.1 in 2001 and 179.9 in 2002. Therefore, the rate of inflation in 2002 was about

between 1980 and 2000 the price level approximately doubled. The average annual rate of inflation over this 20-year period was about:

If the rate of inflation is 12% per year, the price level will double in about:

Demand-pull inflation occurs when..

inflation initiated by increases in wages or other resource prices is labeled:

Real income can be determined by

during a period of hyperinflation

inflation is undesirable because it:

If the nominal interest rate is 5% and the real interest rate is 2%, then the inflation premium is

How do you find a GDP Gap?

How do you find the unemployment rate?

What is a negative GDP gap?

what is a positive GDP Gap?

How do you find CPI?

How do you find the change in CPI?

How do you find the nominal interest rate?

What is the real GDP per capita formula?

What is the growth rate per real GDP formula?

Growth rate per GDP per capita

What does inflation premium mean?

Using the expenditures method how do you find Nominal GDP?

How do you find NDP?

How do you find national income?

How do you find personal income?

Nominal interest rate is found by?