Question 1

At the end of an expansion,wages of workers are usually rising faster than prices.

Accepted Answer

A) True 
 B)False

Question 2

Potential GDP refers to

Accepted Answer

A) the level of GDP attained when all firms are producing at capacity. 
B) the level of GDP attained by the country with the highest growth in real GDP in a given year. 
C) the difference between the highest level of real GDP per quarter and the lowest level of real GDP per quarter within any given year. 
D) the extent to which real GDP is above or below nominal GDP. 
A) the level of GDP attained when all firms are producing at capacity. 
B) the level of GDP attained by the country with the highest growth in real GDP in a given year. 
C) the difference between the highest level of real GDP per quarter and the lowest level of real GDP per quarter within any given year. 
D) the extent to which real GDP is above or below nominal GDP.

Question 3

The sum of public and private saving in an economy is equal to

Accepted Answer

A) Y - C - T. 
B) T - TR - G. 
C) Y - C - G. 
D) I - C - G. 
A) Y - C - T. 
B) T - TR - G. 
C) Y - C - G. 
D) I - C - G.

Question 4

Table 14-2
 $$\begin{array} { | c | c | } 
\hline \text { Year } & \begin{array} { c } 
\text { Real GDP (billions } \
\text { of 2000 dollars) }
\end{array} \
\hline 2010 & \$ 10,100 \
\hline 2011 & 10,950 \
\hline 2012 & 11,425 \
\hline 2013 & 11,300 \
\hline
\end{array}$$
-Refer to Table 14-2.Using the table above,what is the approximate growth rate of real GDP from 2011 to 2012?

Accepted Answer

A) 1% 
B) 2% 
C) 3% 
D) 4% 
A) 1% 
B) 2% 
C) 3% 
D) 4%

Question 5

In an open economy,there is interaction with other economies in terms of both trading of goods and services and borrowing and lending.

Accepted Answer

A) True 
 B)False

Question 6

Article Summary
According to the Office for National Statistics in the United Kingdom, productivity in the UK in 2012 was well below the average of the G7 countries, only faring better than Japan. The G7 is a group of the seven most industrialized countries, and includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States. Compared to the G7 average, the UK was  16% less productive per hour worked, and output was 19% worse when measured on a per worker basis. The productivity gap was the largest for the UK since 1994. Worker productivity has increased in all of the G7 nations except for the UK since 2007, where it has fallen by two percentage points. The most productive workers were in the United States, where workers were 29 percentage points more productive per hour worked than in the UK.

-Refer to the Article Summary.________ depend on increases in labor productivity.

Accepted Answer

A) Advances in technology 
B) Decreases in the inflation rate 
C) Decreases in the unemployment rate 
D) Increases in real GDP per capita 
A) Advances in technology 
B) Decreases in the inflation rate 
C) Decreases in the unemployment rate 
D) Increases in real GDP per capita

Question 7

The budget deficit is defined as

Accepted Answer

A) T - (G + TR), and this is negative. 
B) T - (G + TR), and this is positive. 
C) T + (G - TR), and this is negative. 
D) T + (G + TR), and this is negative. 
A) T - (G + TR), and this is negative. 
B) T - (G + TR), and this is positive. 
C) T + (G - TR), and this is negative. 
D) T + (G + TR), and this is negative.

Question 8

Which of the following increases labor productivity?

Accepted Answer

A) an increase in the aggregate hours of work 
B) decreases in the availability of computers and factory buildings 
C) inventions of new machinery, equipment, or software 
D) a decline in the health of the population 
A) an increase in the aggregate hours of work 
B) decreases in the availability of computers and factory buildings 
C) inventions of new machinery, equipment, or software 
D) a decline in the health of the population

Question 9

If real GDP per capita doubles between 2005 and 2020,what is the average annual growth rate of real GDP per capita?

Accepted Answer

A) 4.7% 
B) 10.5% 
C) 15% 
D) 21% 
A) 4.7% 
B) 10.5% 
C) 15% 
D) 21%

Question 10

If real GDP grows by 3% in 2011,3.2% in 2012,and 2.5% in 2013,what is the average annual growth rate of real GDP?

Accepted Answer

A) 2.6% 
B) 2.9% 
C) 3.1% 
D) 4.2% 
A) 2.6% 
B) 2.9% 
C) 3.1% 
D) 4.2%

Question 11

Countries without well-developed financial systems are able to sustain high levels of economic growth.

Accepted Answer

A) True 
 B)False

Question 12

Potential GDP is always greater than real GDP in an economy.

Accepted Answer

A) True 
 B)False

Question 13

Which one of the following is not considered a financial intermediary?

Accepted Answer

A) a bank 
B) a pension fund 
C) an insurance company 
D) a credit counselor 
A) a bank 
B) a pension fund 
C) an insurance company 
D) a credit counselor

Question 14

Recessions cause the unemployment rate to ________ and the inflation rate to ________.

Accepted Answer

A) rise; rise 
B) rise; fall 
C) fall; rise 
D) fall; fall 
A) rise; rise 
B) rise; fall 
C) fall; rise 
D) fall; fall

Question 15

Private saving is defined as

Accepted Answer

A) Y + TR - C - T. 
B) T + G + TR. 
C) T - G + TR. 
D) Y + TR + C - T. 
A) Y + TR - C - T. 
B) T + G + TR. 
C) T - G + TR. 
D) Y + TR + C - T.

Question 16

If technological change increases the profitability of new investment for firms,then the ________ curve for loanable funds will shift to the ________ and the equilibrium real interest rate will ________.

Accepted Answer

A) supply; right; fall 
B) supply; left; rise 
C) demand; right; rise 
D) demand; left; fall 
A) supply; right; fall 
B) supply; left; rise 
C) demand; right; rise 
D) demand; left; fall

Question 17

Which of the following financial securities is most liquid?

Accepted Answer

A) a savings account 
B) a share of stock 
C) a cashier's check 
D) a $20 bill 
A) a savings account 
B) a share of stock 
C) a cashier's check 
D) a $20 bill

Question 18

As the economy nears the end of an expansion,interest rates usually ________ and wages raise more ________ than prices.

Accepted Answer

A) rise; rapidly 
B) rise; slowly 
C) fall; rapidly 
D) fall; slowly 
A) rise; rapidly 
B) rise; slowly 
C) fall; rapidly 
D) fall; slowly

Question 19

Workers in high-income countries have ________ to work with than do workers in low-income countries.

Accepted Answer

A) less physical capital 
B) more physical capital 
C) more labor 
D) more labor and less physical capital 
A) less physical capital 
B) more physical capital 
C) more labor 
D) more labor and less physical capital

Question 20

Following the September 11,2001,terrorist attacks,the managers of many hotels expected a prolonged period of reduced travel,responding by laying off workers and postponing or canceling new construction.Isadore Sharp,the chairman and CEO of Four Seasons Hotels,decided to

Accepted Answer

A) continue expanding and was able to maintain or enhance the company's market share. 
B) continue expanding and the company ended up losing significant market share. 
C) curtail expansion plans, and by significantly cutting back on expansion was able to maintain the company's market share. 
D) curtail expansion plans and the company ended up losing significant market share. 
A) continue expanding and was able to maintain or enhance the company's market share. 
B) continue expanding and the company ended up losing significant market share. 
C) curtail expansion plans, and by significantly cutting back on expansion was able to maintain the company's market share. 
D) curtail expansion plans and the company ended up losing significant market share.

At the end of an expansion,wages of workers are usually rising faster than prices.

Potential GDP refers to

The sum of public and private saving in an economy is equal to

Table 14-2 Year Real GDP (billions of 2000 dollars) 2010 \ 10,100 2011 10,950 2012 11,425 2013 11,300 -Refer to Table 14-2.Using the table above,what is the approximate growth rate of real GDP from 2011 to 2012?

In an open economy,there is interaction with other economies in terms of both trading of goods and services and borrowing and lending.

The budget deficit is defined as

Which of the following increases labor productivity?

If real GDP per capita doubles between 2005 and 2020,what is the average annual growth rate of real GDP per capita?

If real GDP grows by 3% in 2011,3.2% in 2012,and 2.5% in 2013,what is the average annual growth rate of real GDP?

Countries without well-developed financial systems are able to sustain high levels of economic growth.

Potential GDP is always greater than real GDP in an economy.

Which one of the following is not considered a financial intermediary?

Recessions cause the unemployment rate to and the inflation rate to .

Private saving is defined as

If technological change increases the profitability of new investment for firms,then the curve for loanable funds will shift to the and the equilibrium real interest rate will .

Which of the following financial securities is most liquid?

As the economy nears the end of an expansion,interest rates usually and wages raise more than prices.

Workers in high-income countries have ________ to work with than do workers in low-income countries.

Following the September 11,2001,terrorist attacks,the managers of many hotels expected a prolonged period of reduced travel,responding by laying off workers and postponing or canceling new construction.Isadore Sharp,the chairman and CEO of Four Seasons Hotels,decided to

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Exam 14: Economic Growth, the Financial System, and Business Cycles

At the end of an expansion,wages of workers are usually rising faster than prices.

Potential GDP refers to

The sum of public and private saving in an economy is equal to

Table 14-2 Year Real GDP (billions of 2000 dollars) 2010 \ 10,100 2011 10,950 2012 11,425 2013 11,300 -Refer to Table 14-2.Using the table above,what is the approximate growth rate of real GDP from 2011 to 2012?

In an open economy,there is interaction with other economies in terms of both trading of goods and services and borrowing and lending.

The budget deficit is defined as

Which of the following increases labor productivity?

If real GDP per capita doubles between 2005 and 2020,what is the average annual growth rate of real GDP per capita?

If real GDP grows by 3% in 2011,3.2% in 2012,and 2.5% in 2013,what is the average annual growth rate of real GDP?

Countries without well-developed financial systems are able to sustain high levels of economic growth.

Potential GDP is always greater than real GDP in an economy.

Which one of the following is not considered a financial intermediary?

Recessions cause the unemployment rate to ________ and the inflation rate to ________.

Private saving is defined as

If technological change increases the profitability of new investment for firms,then the ________ curve for loanable funds will shift to the ________ and the equilibrium real interest rate will ________.

Which of the following financial securities is most liquid?

As the economy nears the end of an expansion,interest rates usually ________ and wages raise more ________ than prices.

Workers in high-income countries have ________ to work with than do workers in low-income countries.

Following the September 11,2001,terrorist attacks,the managers of many hotels expected a prolonged period of reduced travel,responding by laying off workers and postponing or canceling new construction.Isadore Sharp,the chairman and CEO of Four Seasons Hotels,decided to

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Recessions cause the unemployment rate to and the inflation rate to .

If technological change increases the profitability of new investment for firms,then the curve for loanable funds will shift to the and the equilibrium real interest rate will .

As the economy nears the end of an expansion,interest rates usually and wages raise more than prices.