D g 9. (0203 LC) Mary was red from the car factory where she used to work and was replaced by machines, and Frank quit his job voluntarily and is in search of a new one. Which types of unemployment will these two individuals be categorized in? (2 points) 0 Marycyclical unemployment; Frankfrictional unemployment O Marystructural unemployment; Frankcyclical unemployment O Mary~discouraged unemployment; Frankicyclical unemployment Marystructural unemployment; Frankfrictional unemployment O Maryfrictional unemployment; Frankdiscouraged unemployment J] j 10, (02.03 MC) An economy's structural unemployment rate is 2 percent, its frictional unemployment rate is 4 percent, and its cyclical unemployment rate is 3 percent, Based on this data, its natural unemployment rate is and its actual unemployment rate is . (2 points) O 5 percent; 6 percent 6 percent; 9 percent 0 7 percent; 9 percent 0 9 percent; 7 percent 0 9 percent; 6 percent J] j 11' (0203 MC) Under which scenario will the actual rate of unemployment be higher than the natural rate of unemployment? (2 points) Recession in the business cycle 0 Replacement of human |abor by machinery 0 Aggregate demand in the economy increases 0 Decrease in skilled workers 0 Fewer workers seeking better paying jobs D j 12. (02.04MC) Which of the following is true about the consumer price index (CPI) as an economic indicator? (2 points) 0 The CPI is useful in understanding the level of ination in an economy. 0 The CPI is based on the prices of all consumer goods in the market. 0 The CPI always shows an increase in the price level in an economy. 0 The CPI shows changes in the cost of living based on changes in income. 0 The CPI represents the economic growth rate, Q g 13. (02.04MC) If the price of a basket of goods in the given year is $56 and the price of the basket of goods in the base year is $70. then what is the consumer price index (CPI) for the given year? (2 points) Q [j 144 (02.04HC) Assume that only two goods, A and B, are produced in an economy. In the base year, 5 units ofA are produced for a price of $4, and 5 units of B are produced for a price of 36' And in a given year, 5 units ofA are produced for a price of $5, and 5 units of B are produced for a price of 39' What is the CPI for the given year? (2 points) D [j 15. (02.04 LC) The CPI is calculated on the basis of a basket of products, but is temporarily misrepresented due to the introduction of_ products (2 points) 0 new; old 0 new; common common; new 0 common; old 0 old; common 16. (02.05 LC) Assume that the inflation rate in an economy is expected to be 3% but turns out to be -1% instead. Which of the following statements about the economy is true? (2 points) O There is a decrease in the price level because of an unexpected deflation in the economy. O There is a decrease in the price level because of unexpected inflation in the economy. O There is an increase in the price level because of an unexpected deflation in the economy. O There is an increase in the price level because of unexpected inflation in the economy. The price level remains constant because of an unexpected deflation in the economy. 17. (02.05 MC) Which of the following categories are the losers of a higher than expected increase in the price level? (2 points) Debtors, creditors, and savers O Creditors and savers Debtors and creditors O Savers only Debtors and savers18. (02.06 MC) Use the data table to answer the question that follows. Year Nominal GDP GDP Deflator $640 billion 160 2 $1050 billion 175 By how much did the value of output, adjusted for inflation, change from Year 1 to Year 2? (2 points) O $200 billion $410 billion $179 billion $400 billion $600 billion19. (02.06 MC) Assume that in an economy, the value of the total output at current prices is $450 billion when the GDP Deflator is 150 for Year 1, and in Year 2, it is $675 billion when the GDP Deflator is 225. Which of the following statements is true in this scenario? (2 points) O The value of the total output adjusted for inflation has increased by $225 billion in year 2. The value of the total output adjusted for inflation has increased by $300 billion in year 2. O The value of the total output adjusted for inflation has decreased by $225 billion in year 2. O The value of the total output adjusted for inflation has remained the same in year 2. O There is insufficient data to determine the value of the total output adjusted for inflation in year 2.W 20. (02.06 MC) Use the data table for country B to answer the question that follows. Year Real GDP GDP Deflator 2019 $50,000 400 2020 $40,000 200 What is the change in the nominal GDP from 2019 to 2020? (2 points) The nominal GDP has increased by $120,000. O The nominal GDP has increased by $100,000. O The nominal GDP has decreased by $120,000. O The nominal GDP has remained constant. The nominal GDP has decreased by $100,000.Q D 21, (0206 MC) If the real GDP and nominal GDP are $200 billion and $620 billion respectively, what is the value of the GDP deator? (2 points) D 3 22, (0207 LC) At the current equilibrium real GDP, there is a recessionary output gap. Which of the following must be true? (2 points) 0 There is no cyclical unemployment. O The economy is expanding. O The economy is at full employment. 0 The actual unemployment rate is higher than the natural rate. 0 There is ination that is higher than expected Q D 23' (02.07 MC) Potential Real GDP Real GDP Actual Real GDP 2000 2004 2010 2015 2019 TI me In which year did the economy above most likely have an actual unemployment rate equal to the sum of its frictional and structural unemployment rate? (2 points) E] D 2. (02.01 LC) How does a circular ow model illustrate GDP? (2 points) The circular flow model is a visualization of the economic transactions across the economy. 0 The circular flow model shows only the factor payments received by households. 0 The circular flow model represents the balance of payments of the government. 0 The circular flow model is a visualization of economic transactions in foreign countries. 0 The circular ow model represents the long-run equilibrium in an economy. m 3 24. (02.07 MC) Economists conclude that Country A is overheated and the output is about to fall. Which of the business cycle phases is referred here? (2 points) O Expansion 0 Recession Q [:71 3. (02.01 HC) Use the table to answer the question that follows. Private spending $16 trillion Government spending $20 trillion Change in inventories $10 trillion Money spent on stocks $5 trillion Net exports $14 trillion Wages to employees $6 trillion What is the GDP of the country, according to the expenditures approach? (2 points) 0 $71 trillion $60 trillion O $56 trillion D [:71 4. (02.02 MC) Which of the following would be counted as part of GDP! as calculated by the expenditures approach? (2 points) 0 Medical advice offered by a doctor to a relative 0 An increase in leisure time due to a technological breakthrough O Informal economic transactions using only cash Money spent by a business on new production equipment 0 The prots shared by stockholders of a major company m [j 5. (02.02MC) Nominal GDP fails to take account of and real GDP still does not measure . (2 points) 0 changes in business inventories; household consumption ination; non-market transactions 0 exports; imports O imports; government spending on infrastructure 0 capital investments; goods produced in the country and sold overseas Q g 6. (02.03 Ho) The following table shows the demographic of a country, as given by the Bureau of Labor Statistics. Individuals under the age of 16 16 million Retired individuals over the age 65 9 million Discouraged workers of age 16 and above 5 million Employed persons of age 16 and above 18 million Unemployed persons of age 16 and above 8 million Based on the above data, what is the labor force participation rate (LFPR) for this country? {2 points) Q 13 7. (02.03 H0) The following data is taken from a survey by the Bureau of Labor Statistics: Unemployed individuals not looking for work 9 million Individuals employed full time 37 million Individuals employed part time 11 million Self-employed individuals 12 million Unemployed individuals 1 5 million Based on the above data, what is the unemployment rate for the population of the country? (2 points) m 3 8. (02.03 MC) If an unemployed worker does not take any action to seek employment for more than four weeks, which of the following would happen to the employment statistics? (2 points) 0 The unemployment rate and the labor force participation rate would both increase. 0 The unemployment rate would increase, and the labor force participation rate would decrease. O The unemployment rate and labor force participation rate would decrease. O The unemployment rate would decrease, and the labor force participation rate would increase. 0 The unemployment rate would stay constant, and the labor force participation rate would decrease. Q 1. (02.01 MC) Which of the following statements explains the difference between final goods and intermediate goods with regards to the GDP? (2 points) Final goods are semi-finished goods used in the production of intermediate goods, while intermediate goods are used for consumption purposes, and both are included in the GDP. O Intermediate goods are semi-finished goods used to produce final goods, while final goods are used for consumption purposes, but only final goods are included in the GDP. O Intermediate goods are semi-finished goods used to produce final goods, while final goods are used for consumption purposes, and both are included in the GDP. O Final goods are semi-finished goods used to produce intermediate goods, while intermediate goods are used for consumption purposes, but only intermediate goods are included in the GDP. O Intermediate goods are semi-finished goods used to produce final goods, while final goods are used for consumption purposes, but only intermediate goods are included in the GDP