1 A macroeconomist would study

Select one:

a.The impact of new tariffs on the agricultural sector in Iowa.

b.the impact of regulations in the banking sector in Florida.

c.economic policies designed to stimulate the country's economy out of a recession.

d.household spending patterns in lower-income groups.

2 Assume the economy of country G produces hotdogs and buns in the following quantities and prices in 2017 and 2018. Assume also that 2017 is the base year and the real GDP will be calculated using 2017 prices. What is the real yearly growth (between 2017 and 2018)?

Hot Dogs

Buns

Quantity

Price

Quantity

Price

Year 2017 (base year)

5 million

$3

2 million

$2

Year 2018

7 million

$5

6 million

$4

Select one:

a.73.7%

b.32.2%

Incorrect. Check your calculations. Real yearly growth = (Real GDP2018 - Real GDP2017)/RealGDP 2017

c.211%

d.42.4%

3 Concerning the four phases in the economic cycle, what does point B represent?

Select one:

a.peak

b.Trough

c.Recession

Incorrect. Recessions happen when GDP falls

d.Recovery

4 Concerning the four phases in the economic cycle, what is represented by point D?

Select one:

a.trough

b.recovery

c.Expansion

Incorrect. Expansions takes place when the GDP rises past a previous peak.

d.Recession

5 GDP includes

Select one:

a.Cars produced by Ford in Mexico

b.final goods and inventories of imported intermediate goods.

c.only final goods to avoid double counting when including intermediate goods.

d.intermediate and final goods to count all goods and services produced.

Incorrect. Intermediate goods are not included

6GDP includes

Select one:

a.Purchases of products made by American businesses and the government only.

b.all purchases of products from the federal government, consumers in the US and around the world.

Incorrect. The GDP only considers products made in the US.

c.purchases of US made products by consumers, private businesses and the government sector.

d.purchases of US made products by the federal government, consumers and private businesses in the US only.

7Given the following information, what would the real growth in 2015 be?

Nominal GDP

GDP Deflator

2014

$120 billion

110

2015

145 billion

126

Select one:

a.5.6%

b.21%

c.38.6%

Incorrect. Check your calculations. Real yearly growth = (Real GDP2017 - Real GDP2016)/RealGDP 2016 and Real GDP = Nominal GDP / GDP Deflator

d.4.1%

8 According to the growth accounting studies, if you lived in a country where illiteracy was high and 40% of the children left school early and did not complete their education what would probably be the results for that country?

Select one:

a.More technological breakthroughs would happen in this country.

b.The economic status of the country would continue to rise.

c.Average income in the country will see significant increases.

Incorrect. That is unlikely if there is no improvement in education.

d.There would be both a human and economic loss.

1 A macroeconomist would study

Select one:

a.The impact of new tariffs on the agricultural sector in Iowa.

b.the impact of regulations in the banking sector in Florida.

c.economic policies designed to stimulate the country's economy out of a recession.

d.household spending patterns in lower-income groups.

2 Assume the economy of country G produces hotdogs and buns in the following quantities and prices in 2017 and 2018. Assume also that 2017 is the base year and the real GDP will be calculated using 2017 prices. What is the real yearly growth (between 2017 and 2018)?

Hot Dogs

Buns

Quantity

Price

Quantity

Price

Year 2017 (base year)

5 million

$3

2 million

$2

Year 2018

7 million

$5

6 million

$4

Select one:

a.73.7%

b.32.2%

Incorrect. Check your calculations. Real yearly growth = (Real GDP2018 - Real GDP2017)/RealGDP 2017

c.211%

d.42.4%

3 Concerning the four phases in the economic cycle, what does point B represent?

Select one:

a.peak

b.Trough

c.Recession

Incorrect. Recessions happen when GDP falls

d.Recovery

4 Concerning the four phases in the economic cycle, what is represented by point D?

Select one:

a.trough

b.recovery

c.Expansion

Incorrect. Expansions takes place when the GDP rises past a previous peak.

d.Recession

5 GDP includes

Select one:

a.Cars produced by Ford in Mexico

b.final goods and inventories of imported intermediate goods.

c.only final goods to avoid double counting when including intermediate goods.

d.intermediate and final goods to count all goods and services produced.

Incorrect. Intermediate goods are not included

6GDP includes

Select one:

a.Purchases of products made by American businesses and the government only.

b.all purchases of products from the federal government, consumers in the US and around the world.

Incorrect. The GDP only considers products made in the US.

c.purchases of US made products by consumers, private businesses and the government sector.

d.purchases of US made products by the federal government, consumers and private businesses in the US only.

7Given the following information, what would the real growth in 2015 be?

Nominal GDP

GDP Deflator

2014

$120 billion

110

2015

145 billion

126

Select one:

a.5.6%

b.21%

c.38.6%

Incorrect. Check your calculations. Real yearly growth = (Real GDP2017 - Real GDP2016)/RealGDP 2016 and Real GDP = Nominal GDP / GDP Deflator

d.4.1%

8 According to the growth accounting studies, if you lived in a country where illiteracy was high and 40% of the children left school early and did not complete their education what would probably be the results for that country?

Select one:

a.More technological breakthroughs would happen in this country.

b.The economic status of the country would continue to rise.

c.Average income in the country will see significant increases.

Incorrect. That is unlikely if there is no improvement in education.

d.There would be both a human and economic loss.