Q2. Recall the Application about intellectual property in GDP accounts to answer the following question.

According to theApplication, after2013, firm expenditures on research and development and new artistic work were treated as________ in our GDP accounts.

A.

net exports

B.

intermediate inputs

C.

investment

D.

consumption

Q4. The following table lists the basket of goods in the

Consumer Price Index for the nation of Astro(Assume 2014 is the baseyear.)

Table 6.2

2014 Quantity 2014 Price 2015 Quantity 2015 Price 2016 Quantity 2016 Price

Sunglasses 8 $9.00 10 $11.00 7 $10.00

Toothpaste 15 3.00 18 4.00 15 4.00

Ferrets 6 12.00 4 15.00 9 18.00

Using the information in Table6.2, the Astro Consumer Price Index for 2015 is

A.

87.

B.

99.

C.

126.

D.

238.

Q6. Consider a production function Y= F(K,L), where Y is the level ofGDP, K is the stock ofcapital, and L is the stock of labor. If the production function was drawn with labor on thex-axis and GDP on they-axis, then an increase in labor will be illustrated as

A.

a movement in the production function upward along the line.

B.

a downward shift in the production function.

C.

an upward shift in the production function.

D.

a movement in the production function downward along the line.

Q7. According to thetext, ________ is perhaps the most critical aspect of acountry's economic performance.

A.

the living standard

B.

the inflation rate

C.

growth in GDP

D.

the unemployment rate

Q8. Recall the Application about declining U.S. labor force participation rates since 1999 to answer the following question.

According to thisApplication, one explanation for the decline in the U.S. labor force participation rate since 1999 is

A.

the increase in foreign ownership ofU.S.-based companies.

B.

the growing number of workers who have postponed retirement.

C.

higher college enrollment.

D.

sluggish economic growth that resulted in more discouraged workers.