1) Which of the following is most likely to contribute to economic growth as measured by real GDP per capita?

rapid population growth

the imposition of tariffs and quotas on imported goods

increased capital formation

an increase in marginal tax rates

2) What is the term for the difference between the nominal interest rate and the rate of inflation?

the coupon rate

the discount rate

the real interest rate

the prime rate

3) How do economists define the marginal propensity to consume (MPC)?

as the additional consumption that results from one dollar increase in disposable income

as the fraction of total disposable income that households spend on consumption

as the additional disposable income households earn in a given period

as the fraction of total disposable income that households save

4) How is the unemployment rate calculated?

the number of unemployed persons divided by the number of employed persons

the number of unemployed persons divided by the population

the number of unemployed persons divided by the number of employed plus unemployed persons

the number of employed persons divided by the number of unemployed persons

5) Which economist is given credit for stating that "in the long run, we are all dead"?

Adam Smith

John Maynard Keynes

Milton Friedman

David Ricardo

6) What is depreciation?

It is income received but NOT earned.

It is an indirect business tax.

It is income earned but NOT received.

It is an allowance for the replacement of capital.

7) Which of the following terms best describes persons who work 25 hours per week?

part of the labour force

overemployed

discouraged workers

unemployed

8) Where would you generally buy consumer nondurable goods?

a stock market

a dentist's office

a grocery store

a clothing store