Error Log: Econ

Economic analysis relies on…

Observation, description, measurement, theory, and the use of models

Producer surplus

The difference of the market price and the opportunity cost to producers.]

Rent seeking

socially unproductive activities seeking to direct economic benefits to one set of actors rather than another

Pork barrel politics

Proclivity of elected officials to introduce projects that steer money to their communities

Whom did the US Department of Commerce commission in 1932 to develop a system to measure of national output?

Simon Kuznets

The labor force participation rate is calculated as the ratio of the

Labor force to the working-age population

Real interest equals

Nominal interest rate minus inflation

How many members constitute the Federal Reserve’s board of governors?

7

Why primarily did the natural rate of unemployment rise in the 70s?

More women entered the paid workforce

Why do shifts in relative prices not explain the downward-sloping aggregate demand curve?

A drop in aggregate price level means that all goods have gotten cheaper

What is the MOST likely effect of a lower price level on the market for savings?

Lower interest rates encourage people to borrow money

One of the costs that inflation imposes on firms is the need to

adjust the prices of their products more frequently

A producer has an absolute advantage in making a good when the producer

Can make more of the good than others using the same resources

In the economic analysis of transportation projects, a reduction in a cost in a cost is treated as

A benefit

An economic impact analysis of a new highway would track indicators such as

jobs, household income, and business sales

Which of the following explains why economists include capital goods in GDP in the year they are produced?

Consistency

Which of the following is the BEST description of positive economics?

Value free

Due to pressure on limited transportation budgets, all of the following are examples of allocating funds where they can be most effective, EXCEPT…

a. meet growing demand

b. restore capacity

c. maintain toll collection

d. extend service life

c. Maintain toll collection

What is one of the important insights of the Coase Theorem regarding the initial distribution of rights?

It does not affect the ability of the parties to come to an efficient agreement

Why does CPI overstate the true rate of inflation?

Introduction of new goods and services

Recently, what has changed not only where people choose to live, but also when and how often they travel?

Remote and hybrid work

How does a competitive market achieve an efficient outcome?

The self-interested actions of its participants