What are the three statistics that economists use to gauge the health of an economy? Question 1 options: A. Real GDP per capita, inflation rate, unemployment rate B. Real GDP, inflation rate, unemployment rate C. Real GDP per capita, inflation rate, unemployment rate D. Nominal GDP, Real GDP, GDP per capita Question 2 (1 point) Which of the following definitions is NOT correct? Question 2 options: Unemployment rate is the rate of those able to work, seeking work and unable to find a job Real GDP is the aggregate output of an economy in dollar value of the final goods and services produced in the physical borders of a country during a period of time Inflation is the increase in prices Real GDP per capita is Real GDP divided by the population of a country Question 3 (1 point) The following are questions that macroeconomists strive to answer but one of them do not belong. Circle the imposter. Question 3 options: Why do some households prefer certain goods while other households buy other goods? How can we fix/prevent fluctuations in the business cycle? Why are some countries rich while some countries stay poor? Why do some countries have an increasing standard of living while other countries continue to stay stagnant? Question 4 (1 point) What is the heart/core of economic growth? Question 4 options: Supply and demand Negative externalities Savings and investment Shocks and sticky prices Question 5 (1 point) What are the main causes of short-term fluctuations in the business cycle? Question 5 options: Supply and demand Consumer surplus Shocks and sticky prices Savings and investment Question 6 (1 point) *BONUS* Please give me an example of a personal shock from your own experience. Question 6 options: Question 7 (1 point) Determine if the following example belongs in the GDP and if so, which approach and category. A private firm builds a research facility to develop new alternatives for fossil fuels. Question 7 options: No Yes, under Income approach, in Profit Yes, under Expenditures approach, in Investments Yes, under Expenditures approach, in Consumption Question 8 (1 point) Determine if the following example belongs in the GDP and if so, which approach and category. You buy Snapchat stocks because the market is down. Question 8 options: Yes, Expenditures approach, in Consumption No Yes Income approach, in Taxes Yes, Expenditures approach, in Income Question 9 (1 point) Determine if the following example belongs in the GDP and if so, which approach and category. Your grandma buys a brand new Tesla from the car dealership. Question 9 options: No Yes, Income, in Profits Yes, Expenditures, in Investment Yes, Expenditures, in Consumption Question 10 (1 point) Determine if the following example belongs in the GDP and if so, which approach and category. A landlord collects rent from an apartment building. Question 10 options: A.Yes, Income, in Rent B.Yes, Expenditures, Net Exports C.Yes, Expenditures, in Investment D.No Question 11 (1 point) When adjusting Nominal GDP to Real GDP, what is the Price Index for the base year, always? Question 11 options: 0 Not enough information 100 10 Question 12 (1 point) Why do we need to adjust the Nominal GDP to Real GDP? Question 12 options: There is no need to adjust Nominal GDP To correct for the appropriate national currency To account for inflation To make life harder Question 13 (1 point) When referring to the GDP, what is the statistical discrepancy? Question 13 options: A figure added to account for the income of those that do not live in the borders of the country A figure added to the expenditures side of real GDP A figure added to the expenditures side to take out imports from exports A figure added to the income side of GDP for it to equal the expenditures side of GDP Question 14 (3 points) We know the GDP has some shortcomings where it doesn't capture the whole pictures of a nation. There are SEVEN that the book mentions. Name ONE of the shortcomings that you think SHOULD be considered when we look at how a country is doing. Be sure to DEFINE it and explain WHY you think it should be included. Question 15 (1 point) *BONUS* What is another measure you think we should use? Be sure to tie in how your measure would be able to reflect on how well a nation is doing. For example: I think the wage gap of women and men should be examined because typically countries that have a smaller gap tend to do better than those with a large wage gap. It also indicates that there is less gender discrimination which is a sign of a growing economy. Question 16 (1 point) Per our book and lecture, economic growth is defined by: Question 16 options: The business cycle Increase in inflation rate An increase in Real GDP or an increase in Real GDP per Capita over time The economy growing Question 17 (1 point) When comparing living standards, which statistic do we use? Question 17 options: Real GDP Unemployment rate Nominal GDP Real GDP per capita Question 18 (1 point) Why is possible for countries with a lower living standard to potentially grow faster than countries with an already high living standard? Question 18 options: It is not possible. Countries with a high living standard are bound to decrease their level of living eventually Countries with a lower living standard are more likely to receive international funding. Countries with a lower living standard only need to adopt existing technology whereas the countries with high living standards need to continue to invent more Question 19 (2 points) There are several institutional structures that promotes economic growth (efficient financial institutions, patents and property rights, free trade, widespread education, etc.). Pick one and explain how it promotes economic growth in a nation. (Hint: Remember what is at the heart/core of economic growth and tie those two concepts together) Question 20 (1 point) What is the most recent invention/technological development that allowed us to be at our current living standard? Question 20 options: Steam engine Automobile Microchip Electricity Question 21 (1 point) *BONUS* What do you think is the next frontier or invention that will take us to the next level of living standard and why? Question 21 options: Question 22 (2 points) Some people believe economic growth should be a goal (because of cultural, social, political impacts, etc.) while other are against economic growth (because they feel it isn't sustainable, environmental impacts, etc.) Are you for or against economic growth? A mixture of both? Using the reasons we have discussed, please explain and support your argument. Question 22 options: Question 23 (1 point) What are the phases of the business cycle? Question 23 options: Depression, expansion, growth, decline Real GDP, inflation, unemployment rate Supply, demand, equilibrium Peak, recession, trough, and expansion Question 24 (1 point) This stage of the business cycle sees output, employment and income at the lowest point of the business cycle. Question 24 options: Expansion Recession Peak Trough Question 25 (1 point) Classify the following example. Ash retires and decides to spend the rest of her life sailing in the Baltic Sea. Question 25 options: In the labor force Structurally unemployed Not in the labor force Cyclically unemployed Question 26 (1 point) Classify the following example. Brock has a newborn baby and has paternity leave under his company. Question 26 options: Not in the labor force Cyclically unemployed In the labor force Frictionally unemployed Question 27 (1 point) Classify the following example. Misty gets laid off from her job as an operator because the company now uses an automated system. Question 27 options: Not in the labor force. Structurally unemployed Frictionally unemployed Cyclically unemployed Question 28 (1 point) Classify the following example. Goku leaves his job as a bartender because he is applying for an accounting position. Question 28 options: Not in the labor force. Frictionally unemployed Structurally unemployed Cyclically unemployed Question 29 (1 point) Which type of unemployment is associated with recessions? Question 29 options: Natural Structural Frictional Cyclical Question 30 (1 point) Our natural rate of unemployment should always be at 0%. Question 30 options: True False Question 31 (1 point) What is the economic cost of unemployment? Question 31 options: Idleness Forgone output Social tension Increase in crime and povery Question 32 (1 point) This type of inflation occurs when the demand for goods and services exceeds the capacity to produce so to counter the demand, the price level increases. This can also occur if the government is injecting money into the economy to boost consumption. Question 32 options: Demand pull Negative demand shock Cost push Core Question 33 (1 point) The CPI accounts for inflation levels of the GDP such as consumption, investment, government purchases, and net exports. Question 33 options: True False Question 34 (1 point) Inflation is complex for economists to diagnose because Question 34 options: the CPI needs to be calculated first because the nominal GDP does not really get affected economists don't know anything it's difficult to tell what type of inflation is occuring Question 35 (1 point) Who gets hurt by unanticipated inflation? Question 35 options: Those living on flexible income, borrowers Everyone Those living on fixed incomes, savers (particularly cash), creditors No one Question 36 (1 point) Inflation can be okay if it occurs at a moderate and predictable pace. If it grows to the point where wages aren't catching up, then it becomes an issue. Question 36 options: True False