Homework SourseQuestion 1 the government producers consumers consumers and
Question 1
the government
producers
consumers
consumers and producers
the government, consumers and producers
2 points
Question 2
Every society faces economic trade-offs. This means
some people live better than others do.
not everyone can have enough goods to survive.
producing more of one good means less of another good can be produced.
society\'s output cannot be made available to all.
2 points
Question 3
Human capital refers to
the money people have.
the machines workers have to work with.
the accumulated skills and training workers have.
the wealth people have.
2 points
Question 4
Cassie\'s Quilts alters, reconstructs and restores heirloom quilts. Cassie has just spent $800 purchasing, cleaning and reconstructing an antique quilt which she expects to sell for $1,500 once she is finished. After having spent $800, Cassie discovers that she would need some special period fabric that would cost her $200 in material and time in order to complete the task. Alternatively, she can sell the quilt \"as is\" now for $900. What should she do?
She should cut her losses and sell the quilt now.
It does not matter what she does; she is going to take a loss on her project.
She should purchase the period fabric, complete the task and then sell the quilt.
She should not do anymore work on the quilt because she has already spent too much time on it and has not been paid for that time.
2 points
Question 5
An example of a factor of production is
a car produced by an auto manufacturer.
a worker hired by an auto manufacturer.
a loan granted to an auto manufacturer.
the automobiles exported by an auto manufacturer.
2 points
Question 6
3 million tons of steel
19 million tons of steel
5 million tons of paper
9 million tons of paper
2 points
Question 7
Point A
Point B
Point C
Points A and C
2 points
Question 8
Point A
Point B
Point C
Points B and C
2 points
Question 9
Guatemala
They have equal productive abilities.
Costa Rica
neither country
2 points
Question 10
half a garden cultivated
two lawns mowed
two-thirds of a garden cultivated.
one and a half lawns mowed
2 points
Question 11
The recession of 2007-2009 would most likely be represented in a production possibilities frontier graph by
a point inside the frontier.
a point outside the frontier.
a point on the frontier.
an intercept on either the vertical or the horizontal axis.
2 points
Question 12
At market equilibrium,
demand equals supply.
quantity demanded equals quantity supplied.
surpluses are greater than shortages.
shortages are greater than surpluses.
2 points
Question 13
A to B.
B to A.
S1 to S2.
S2 to S1.
2 points
Question 14
400
500
600
800
2 points
Question 15
there would be a surplus of 300 units.
there would be a shortage of 300 units.
there would be a surplus of 200 units.
there would be a shortage of 200 units.
2 points
Question 16
Panel (a)
Panel (b)
Panel (c)
Panel (d)
2 points
Question 17
decrease by 35 lb.
increase by 115 lb.
increase by 35 lb.
decrease by 115 lb.
2 points
Question 18
An example of an intermediate good would be
the bread that goes into a sub sandwich that is sold by Quiznos.
the soda pop sold by Quiznos.
a sub sandwich sold by Quiznos.
the potato chips sold by Quiznos.
2 points
Question 19
Gross domestic product is calculated by summing up
the total quantity of goods and services in the economy.
the total quantity of goods and services produced in the economy during a period of time.
the total market value of goods and services in the economy.
the total market value of final goods and services produced in the economy during a period of time.
2 points
Question 20
If prices in the economy rise, then
the purchasing power of a dollar rises.
the purchasing power of a dollar stays constant.
the purchasing power of a dollar declines.
the purchasing power of a dollar cannot be determined.
2 points
Question 21
$428,000
$267,000
$24,000
$1,424
2 points
Question 22
A student who just graduated from college but has not found a job would most likely be
frictionally unemployed.
structurally unemployed.
cyclically unemployed.
seasonally unemployed.
2 points
Question 23
Except for recessions, the duration of unemployment for the typical person lasts
less than six months.
six to nine months.
over nine months.
over one year.
over five years.
2 points
Question 24
Which of the following describes a situation in which the person is hurt by inflation?
a retiree whose pension is adjusted for inflation
a person who borrows money during a period when inflation is under-predicted
a person who lends money during a period when inflation is over-predicted
a person paid a fixed income during an inflationary period
2 points
Question 25
Workers in high-income countries have ________ to work with than do workers in low-income countries.
less physical capital
more physical capital
more labor
more labor and less physical capital
2 points
Question 26
Which of the following will result in an increase in labor productivity?
a decrease in the number of people attending institutions of higher education
a decline in the amount of human capital per worker
an increase in technology
a decline in the capital stock per hour worked
2 points
Question 27
The best measure of the standard of living is
nominal GDP.
real GDP.
nominal GDP per capita.
real GDP per capita.
2 points
Question 28
The federal budget deficit can be reduced by
raising taxes.
raising government spending.
raising transfer payments.
higher interest rates.
2 points
Question 29
Potential GDP refers to
the level of GDP attained when all firms are producing at capacity.
the level of GDP attained by the country with the highest growth in real GDP in a given year.
the difference between the highest level of real GDP per quarter and the lowest level of real GDP per quarter within any given year.
the extent to which real GDP is above or below nominal GDP.
2 points
Question 30
If real GDP in a closed economy is $40 billion, consumption is $20 billion, and government purchases are $10 billion, what is investment?
$10 billion
$30 billion
$40 billion
$70 billion
2 points
Question 31
During the expansion phase of the business cycle, which of the following eventually increases?
production
employment
income
All of these
2 points
Question 32
According to the World Bank, Albania does one of the worst jobs as a country enforcing the rule of law. The consequence of a weak rule of law is
difficulty in attracting investment and low economic growth.
a decrease in cash transactions and increased efficiency.
more risk taking on the part of entrepreneurs and greater economic investment.
strong property rights enforcement leading to greater investment.
2 points
Question 33
All of the following policies are ways for a country to promote long-run economic growth except
increasing vaccinations against infectious diseases.
undergoing political reform to decrease corruption.
enacting stronger laws to protect property rights.
imposing stricter regulations to limit foreign direct investment.
2 points
Question 34
Developing countries with low saving rates and poor levels of health and education are likely to experience
high levels of foreign direct investment.
easy access to financial backing from banks.
rapid growth in household incomes.
low rates of growth in real GDP per capita.
2 points
Question 35
Enforcing property rights in an economy will
cause the market system to work less efficiently.
decrease the level of foreign portfolio investment.
encourage corruption and expand the underground economy.
raise the level of investment.
2 points
Question 36
Sweden has a higher standard of living because their GDP is higher.
Ireland has a higher standard of living because their GDP per capita is higher.
Sweden has a higher standard of living because their GDP per capita is higher.
Ireland has a higher standard of living because growth in GDP is greater in Ireland than in Sweden.
2 points
Question 37
Which of the following policies are designed specifically to directly promote technological change in an economy?
government subsidization of research and development
tax incentives to promote investment in 401K plans
laws to strengthen property rights
a vaccination program to combat infectious diseases
2 points
Question 38
All of the following are components of aggregate expenditure except
consumption spending.
net export spending.
actual investment spending.
government spending.
2 points
Question 39
An increase in Social Security payments will
increase consumption spending.
increase investment spending.
increase government spending.
increase export spending.
2 points
Question 40
Equations for C, I, G, and NX are given below. If the equilibrium level of GDP is $32,000, what will the new equilibrium level of GDP be if government spending increases to 2,500?C = 5,000 + (MPC)YI = 1,500G = 2,000NX = -500
$32,500
$34,000
$38,000
$42,000
2 points
Question 41
$16 billion
$40 billion
$200 billion
$1,000 billion
2 points
Question 42
If disposable income falls by $40 billion and consumption falls by $30 billion, then the slope of the consumption function is
1.33.
0.75.
0.4.
0.3.
2 points
Question 43
The consumption function describes the relationship between
consumption spending and national income.
consumption spending and aggregate income.
consumption spending and disposable income.
consumption spending and personal income.
2 points
Question 44
A negative supply shock in the short run causes
the aggregate supply curve to shift to the left.
the price level to fall.
unemployment to fall.
equilibrium real GDP to rise.
2 points
Question 45
All of the following would be considered a positive addition to household wealth except
the equity in one\'s home.
500 shares of Google stock.
the balance in your savings account.
a credit card balance.
2 points
Question 46
A
B
C
D
2 points
Question 47
If full-employment GDP is equal to $4.2 trillion, what does the long-run aggregate supply curve look like?
It is a horizontal line at $4.2 trillion of GDP.
It is a vertical line at a level of GDP below $4.2 trillion.
It is a vertical line at $4.2 trillion of GDP.
It is a vertical line at a level of GDP above $4.2 trillion.
2 points
Question 48
Interest rates in the economy have fallen. How will this affect aggregate demand and equilibrium in the short run?
Aggregate demand will rise, the equilibrium price level will rise, and the equilibrium level of GDP will rise.
Aggregate demand will rise, the equilibrium price level will fall, and the equilibrium level of GDP will rise.
Aggregate demand will fall, the equilibrium price level will fall, and the equilibrium level of GDP will fall.
Aggregate demand will fall, the equilibrium price level will rise, and the equilibrium level of GDP will fall.
2 points
Question 49
Stagflation occurs when
inflation rises and GDP rises.
inflation falls and GDP rises.
inflation rises and GDP falls.
inflation falls and GDP falls.
2 points
Question 50
The impact of Hurricane Katrina on consumers in the economy was to make them very pessimistic about their future incomes. How does this increased pessimism affect the aggregate demand curve?
This will move the economy up along a stationary aggregate demand curve.
This will move the economy down along a stationary aggregate demand curve.
This will shift the aggregate demand curve to the left.
This will shift the aggregate demand curve to the right.
| the government | ||
| producers | ||
| consumers | ||
| consumers and producers | ||
| the government, consumers and producers |
Solution
1) producers
2) society cannot produce goods for all
3) accumulated skills and training people have
4) purchase fabric and sell the quit to earn 500 profit than 100
5)worker hired is s a factor of productio n
12) point outside the frontier
18) bread is an intermediate good
19 ) total quantity of goods and sservices produced within the economy
20) purchasing power of dollar falls
22) structural unemplyment
23) unemployment may stay for over a year
24) person who borrowed under anticipated inflation
25) more physical capital
26) incerease in technology
27) real gdp per capita
28) consumption spending
29) part b
30) 10 million
31) partd
32) a decrease in transaction and increase effciiency
33) strict laws for FDI
34) low level of growth in gdp per capita
35) raises level of investment
37) government subsidization
38) consumption spending
39) increase investment spenidn
40) 40000
42) 0.75
44) consumption and personal income
46) supply curve shift to left
47) 4,2 vertial line at gdp part c
48) ad fall , price rises part d
49) stagflation meand rise in inflation and unemployment so answer is part d
50) AD will shift to the rights
