Econ Complete Exam 2

Aggregate behavior is

the behavior of all households and firms together.

A period of very rapid increases in the overall price level is known as

hyperinflation

The term business cycle refers to the

short-term ups and downs in the level of economic activity.

The period in the business cycle from a peak down to a trough is referred to as a(n)

recession.

If the labor force is 400 and employment is 380, then the unemployment rate is

5%

If Congress increases government spending, it is using

fiscal policy

To bring the economy out of an inflationary period, Keynes argued that the government should

increase taxes and/or decrease government spending.

Which of the following would be counted in 2023's GDP?

the bonus check a stockbroker gets from his/her company in 2023

The change in business inventories is measured as

GDP minus final sales

Refer to Table 21.5. Personal consumption expenditures in billions of dollars are

2,300

Refer to Table 21.5. The value for gross private domestic investment in billions of dollars is

510

Refer to Table 21.5. The value of gross domestic product in billions of dollars is

3,460

What should be added to national income to calculate GNP?

depreciation

Indirect taxes include all of the following except

property taxes

Refer to Table 21.7. The value for national income in billions of dollars is

825

Refer to Table 21.7. The value for gross domestic product in billions of dollars is

920

Refer to Table 21.7. The value of disposable income in billions of dollars

cannot be calculated given the information in Table 21.7

If GDP is $400 billion, depreciation is $100 billion, and net factor income from the rest of the world is -$60 billion, then net national product is

$240 billion

If real GDP in 2024 using 2023 prices is higher than nominal GDP of 2024, then

prices in 2024 are lower than prices in the base year.

The GDP deflator in year 4 is 120 and the GDP deflator in year 5 is 130. The rate of inflation between years 4 and 5 is

8.33%

For you to be considered not in the labor force, you can be

a full-time retiree.

a full-time student.

a full-time volunteer.

any of the above

any of the above

A man is fired from his job because he was late for work too many times. While he is searching for another job he would be classified as

frictionally unemployed.

The sum of frictional and structural unemployment is thought of as the

natural rate of unemployment.

Refer to Table 22.6. The bundle price for the goods in period 2022 is

$41.00

Refer to Table 22.6. If 2022 is the base year, the price index in 2023 is

123.2

Uncertainty about the future is likely to

decrease current spending.

Refer to Figure 23.3. The equation for the aggregate consumption function is

C = 60 + 0.7Y

Refer to Figure 23.3. The equation for the aggregate saving is

S = -60 + 0.3Y

Assume the following on an economy: marginal propensity to save MPS= 0.1, Autonomous consumption, a = 500, planned investment I= 800. Answer the following:

The equilibrium income Y for this economy is:

$13000

Assume the following on an economy: marginal propensity to save, MPS = 0.1, Autonomous consumption, a = 500, planned investment, I = 800. Answer the following:

If planned investment decreased to 600, the new equilibrium income is:

$11000