From Chapter 2,10

QUESTION 7 An increase in productivity will shift the aggregate: O supply curve rightward. O demand curve leftward. O supply curve leftward. demand curve rightward. QUESTION 8 An increase in taxes will cause a(n): O increase in aggregate demand. O decrease in the quantity of real domestic output demanded. O decrease in aggregate demand increase in the quantity of real domestic output demanded. QUESTION 9 As defined in national income accounting, investment includes: O business expenditures on machinery and equipment. O imports, but not exports. O all nonfood items. O all consumption. QUESTION 10 Assume the natural rate of unemployment in the Canadian economy is 7 percent and the actual rate of unemployment is 9 percent. According to Okun's law, the GDP gap: is 4 percent. is 10 percent is 2 percent O is 8 percent QUESTION 11 Assuming the total population is 100 million, the civilian labour force is 50 million, and 47 million workers are employed, the unemployment rate: is 3 percent. O is 6 percent. is 7 percent. O is 9 percent. QUESTION 12 Between 1967 and 1977 the price level approximately doubled. On the basis of this information we can say that the average annual rate of inflation over this ten-year period was about: O 2 percent. O 4 percent 10 percent O 7 percent. QUESTION 13 GDP data are criticized as being inaccurate measures of economic welfare because: O they do not take into account the adverse effects of economic activity on the environment. they do not take into account changes in product quality. O they do not take into account changes in the amount of leisure. all of these. QUESTION 14 GDP in an economy is $4,600 billion. Consumer expenditures are $3,500 billion, government purchases are $900 billion, and gross investment is $400 billion. Net exports are: O -$ O -$400 billion. O +$200 billion. +$400 billion. QUESTION 15 GDP includes: O neither intermediate nor final goods. both intermediate and final goods. O intermediate, but not final, goods final, but not intermediate, goods