Assume a hypothetical economy produces only two goods as shown below. (base year =2017).

Apples

Oranges

Year

Quantity

Price

Quantity

Price

2017

2

4

1

2

2018

4

5

2

3

2019

6

3

2

1

The real GDP in the year 2019 is equal to:

Group of answer choices

$28

$36

$7

$20

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Question 2

1pts

Assume a hypothetical economy produces only two goods as shown below. (base year =2017).

Apples

Oranges

Year

Quantity

Price

Quantity

Price

2017

2

4

1

2

2018

4

5

2

3

2019

6

3

2

1

The nominal GDP in the year 2018 is equal to:

Group of answer choices

$14

$13

$26

$20

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Question 3

1pts

1. Suppose a family's income increases by 5% at the same time that inflation is 3%. Then:

Group of answer choices

the family's standard of living will fall

the family's standard of living is not affected by inflation

the family's standard of living will increase

the family's standard of living will not change

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Question 4

1pts

Which of the following is the best example of financial investment?

Group of answer choices

A young couple purchases a new home

A student pursues an MBA degree

A retiree purchases Google stock

Ford Motor Co. builds a new manufacturing plant

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Question 5

1pts

Which of the following is the best example of economic investment?

Group of answer choices

A retiree purchases U.S. government bonds

Apple builds a new plant to manufacture iPhones

Your college purchases a 5-year old building in order to offer more classes

You purchase Yahoo stock

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Question 6

1pts

If consumers become pessimistic, the economy is likely to experience:

Group of answer choices

a negative demand shock

a positive supply shock

a negative supply shock

a positive demand shock

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Question 7

1pts

If prices are sticky, then a negative demand shock will lead to:

Group of answer choices

a long-run decrease in real GDP

a long-run increase in real GDP

a short-run increase in real GDP

a short-run decrease in real GDP

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Question 8

1pts

If prices are sticky, positive demand shock will lead to:

Group of answer choices

an unpredictable change in unemployment

a decrease in unemployment

no change in unemployment

an increase in unemployment

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Question 9

1pts

An increase in the overall level of prices is called:

Group of answer choices

nominal GDP growth

inflation

expansion

growth

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Question 10

1pts

Nominal gross domestic product:

Group of answer choices

can change when there is a change in either output or the price level

changes only when there is a change in the price level

measures the change in inventories over the course of a year

changes only when there is a change in output