Inflation and Equilibrium Gdp Level
Midterm Review Macroeconomics
1. The unemployment rate does not take into account individuals who A) goof off on the job. B) are employed by the federal government. C) would like to work, but are discouraged from looking for a job. D) are employed part time.
2. Suppose that Matt quits a job with the XYZ Corporation in order to look for more rewarding employment. Matt would be A) counted as still being employed. B) included in the economy's "hidden employment." C) counted as frictionally unemployed. D) counted as cyclically unemployed.
3. If the current price of a market basket of goods is $850 and the base year price for the same basket is $500, what is the value of the price index? A) 140 B) 170 C) 120 D) 100
4. Under which one of the following situations would you be better off? A) You have $10,000 in your savings account paying 5 percent per year, and unanticipated inflation is 8 percent per year. B) You have paid $500 for a $1,000 Canada savings bond that matures in 10 years, and unanticipated inflation is 10 percent per year. C) You lend a friend $1,000 at 6 percent to be repaid in one year, and unanticipated inflation is 7 percent during the year. D) You borrowed $2,500 at 7 percent to pay for this year's college expenses, and unanticipated inflation is 12 percent during the year.
5. The value of your money income, in terms of buying goods and services, is referred to as your money's A) staying power. B) rigidity factor. C) purchasing power. D) transaction cost.
6. GDP figures may understate the value of goods and services due to A) the exclusion of the underground economy. B) the inclusion of household production. C) the inclusion of legal non-reported, non-taxed income. D) the exclusion of the value of stocks.
7. Which of the following best describes a nation's gross domestic product? A) the market value of
1. The unemployment rate does not take into account individuals who A) goof off on the job. B) are employed by the federal government. C) would like to work, but are discouraged from looking for a job. D) are employed part time.
2. Suppose that Matt quits a job with the XYZ Corporation in order to look for more rewarding employment. Matt would be A) counted as still being employed. B) included in the economy's "hidden employment." C) counted as frictionally unemployed. D) counted as cyclically unemployed.
3. If the current price of a market basket of goods is $850 and the base year price for the same basket is $500, what is the value of the price index? A) 140 B) 170 C) 120 D) 100
4. Under which one of the following situations would you be better off? A) You have $10,000 in your savings account paying 5 percent per year, and unanticipated inflation is 8 percent per year. B) You have paid $500 for a $1,000 Canada savings bond that matures in 10 years, and unanticipated inflation is 10 percent per year. C) You lend a friend $1,000 at 6 percent to be repaid in one year, and unanticipated inflation is 7 percent during the year. D) You borrowed $2,500 at 7 percent to pay for this year's college expenses, and unanticipated inflation is 12 percent during the year.
5. The value of your money income, in terms of buying goods and services, is referred to as your money's A) staying power. B) rigidity factor. C) purchasing power. D) transaction cost.
6. GDP figures may understate the value of goods and services due to A) the exclusion of the underground economy. B) the inclusion of household production. C) the inclusion of legal non-reported, non-taxed income. D) the exclusion of the value of stocks.
7. Which of the following best describes a nation's gross domestic product? A) the market value of