Question 1

Equilibrium in the loanable funds market determines

Accepted Answer

A)  the nominal interest rate. 
B)  the current interest rate. 
C)  the real interest rate. 
D)  the expected interest rate. 
A)  the nominal interest rate. 
B)  the current interest rate. 
C)  the real interest rate. 
D)  the expected interest rate.

Question 2

In comparison to a government that runs a balanced budget,when the government runs a budget deficit

Accepted Answer

A)  the equilibrium interest rate will fall. 
B)  business investment will fall. 
C)  household savings will fall. 
D)  none of the above 
A)  the equilibrium interest rate will fall. 
B)  business investment will fall. 
C)  household savings will fall. 
D)  none of the above

Question 3

What two factors are the keys to determining labor productivity?

Accepted Answer

A)  the business cycle and the growth rate of real GDP 
B)  the growth rate of real GDP and the interest rate 
C)  the level of technology and the quantity of capital per hour worked 
D)  the average level of education of the workforce and the price level 
A)  the business cycle and the growth rate of real GDP 
B)  the growth rate of real GDP and the interest rate 
C)  the level of technology and the quantity of capital per hour worked 
D)  the average level of education of the workforce and the price level

Question 4

The Business Cycle Dating Committee defines a recession as

Accepted Answer

A)  two consecutive quarters of declining real GDP. 
B)  two consecutive quarters of declining nominal GDP. 
C)  a significant decline in activity visible in industrial production, employment, real income, and wholesale/retail trade lasting more than a few months. 
D)  a significant decline in inflation and unemployment lasting more than a few months. 
A)  two consecutive quarters of declining real GDP. 
B)  two consecutive quarters of declining nominal GDP. 
C)  a significant decline in activity visible in industrial production, employment, real income, and wholesale/retail trade lasting more than a few months. 
D)  a significant decline in inflation and unemployment lasting more than a few months.

Question 5

Growth in potential GDP in the United States from 1949 to 2017 was estimated to be about

Accepted Answer

A)  8.25% per year. 
B)  5.0% per year. 
C)  3.2% per year. 
D)  1.5% per year. 
A)  8.25% per year. 
B)  5.0% per year. 
C)  3.2% per year. 
D)  1.5% per year.

Question 6

Which of the following describes the growth in real GDP per person in the United States from 1900 to the present?

Accepted Answer

A)  It has decreased. 
B)  It has increased by more than eight times. 
C)  It has doubled. 
D)  It has increased twenty times. 
A)  It has decreased. 
B)  It has increased by more than eight times. 
C)  It has doubled. 
D)  It has increased twenty times.

Question 7

If real GDP in a small country in 2017 is $8 billion and real GDP in the same country in 2018 is $8.3 billion,the growth rate of real GDP between 2017 and 2018

Accepted Answer

A)  is 3.0%. 
B)  is 3.6%. 
C)  is 3.75%. 
D)  cannot be determined from the information given. 
A)  is 3.0%. 
B)  is 3.6%. 
C)  is 3.75%. 
D)  cannot be determined from the information given.

Question 8

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 9

When the government runs a budget deficit,we would expect to see that

Accepted Answer

A)  private saving will fall. 
B)  investment will fall. 
C)  G + TR < T. 
D)  public saving is positive. 
A)  private saving will fall. 
B)  investment will fall. 
C)  G + TR < T. 
D)  public saving is positive.

Question 10

A decrease in the real interest rate will

Accepted Answer

A)  increase consumption and reduce investment. 
B)  increase saving and investment. 
C)  decrease investment and government spending. 
D)  increase consumption and investment. 
A)  increase consumption and reduce investment. 
B)  increase saving and investment. 
C)  decrease investment and government spending. 
D)  increase consumption and investment.

Question 11

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 12

The growth rate of real GDP in the United States rises from 4.2% to 4.4%.Explain and calculate how this increase in the growth rate of real GDP affects the number of years it will take for real GDP to double.

Accepted Answer

The "Rule of 70" states that the number

Question 13

According to the "Rule of 70," how many years will it take for real GDP per capita to double when the growth rate of real GDP per capita is 5%?

Accepted Answer

A)  less than 1 year 
B)  5 years 
C)  14 years 
D)  35 years 
A)  less than 1 year 
B)  5 years 
C)  14 years 
D)  35 years

Question 14

If GDP grew 3% in 1970,2.2% in 1971 and 2.5% in 1972 then,what is the average annual growth rate over this period?

Accepted Answer

A)  5% 
B)  4% 
C)  2.6% 
D)  -2.2% 
A)  5% 
B)  4% 
C)  2.6% 
D)  -2.2%

Question 15

What is human capital?

Accepted Answer

A)  a slang term for the underground labor market 
B)  manufactured goods that are used to produce other goods 
C)  accumulated knowledge and skills acquired by a worker 
D)  the manager or owner of a business 
A)  a slang term for the underground labor market 
B)  manufactured goods that are used to produce other goods 
C)  accumulated knowledge and skills acquired by a worker 
D)  the manager or owner of a business

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

Inflation is measured

Accepted Answer

A)  using the level of the consumer price index. 
B)  as the percentage change in the consumer price index. 
C)  using the level of real GDP. 
D)  as the percentage change in real GDP. 
A)  using the level of the consumer price index. 
B)  as the percentage change in the consumer price index. 
C)  using the level of real GDP. 
D)  as the percentage change in real GDP.

Question 18

Figure 14-3
  
-Refer to Figure 14-3.Which of the following is consistent with the graph depicted above?

Accepted Answer

A)  The government begins running a budget surplus. 
B)  An expected recession decreases the profitability of new investment. 
C)  An increase in government spending crowds out private expenditures. 
D)  Technological change increases the profitability of new investment. 
A)  The government begins running a budget surplus. 
B)  An expected recession decreases the profitability of new investment. 
C)  An increase in government spending crowds out private expenditures. 
D)  Technological change increases the profitability of new investment.

Question 19

Explain why increasing the government budget deficit can decrease investment spending.

Accepted Answer

Saving must equal investment in the econ

Question 20

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.

Equilibrium in the loanable funds market determines

In comparison to a government that runs a balanced budget,when the government runs a budget deficit

What two factors are the keys to determining labor productivity?

The Business Cycle Dating Committee defines a recession as

Growth in potential GDP in the United States from 1949 to 2017 was estimated to be about

Which of the following describes the growth in real GDP per person in the United States from 1900 to the present?

If real GDP in a small country in 2017 is $8 billion and real GDP in the same country in 2018 is $8.3 billion,the growth rate of real GDP between 2017 and 2018

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

When the government runs a budget deficit,we would expect to see that

A decrease in the real interest rate will

The budget deficit is defined as

The growth rate of real GDP in the United States rises from 4.2% to 4.4%.Explain and calculate how this increase in the growth rate of real GDP affects the number of years it will take for real GDP to double.

According to the "Rule of 70," how many years will it take for real GDP per capita to double when the growth rate of real GDP per capita is 5%?

If GDP grew 3% in 1970,2.2% in 1971 and 2.5% in 1972 then,what is the average annual growth rate over this period?

What is human capital?

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

Inflation is measured

Figure 14-3 -Refer to Figure 14-3.Which of the following is consistent with the graph depicted above?

Explain why increasing the government budget deficit can decrease investment spending.

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

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

Equilibrium in the loanable funds market determines

In comparison to a government that runs a balanced budget,when the government runs a budget deficit

What two factors are the keys to determining labor productivity?

The Business Cycle Dating Committee defines a recession as

Growth in potential GDP in the United States from 1949 to 2017 was estimated to be about

Which of the following describes the growth in real GDP per person in the United States from 1900 to the present?

If real GDP in a small country in 2017 is $8 billion and real GDP in the same country in 2018 is $8.3 billion,the growth rate of real GDP between 2017 and 2018

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

When the government runs a budget deficit,we would expect to see that

A decrease in the real interest rate will

The budget deficit is defined as

The growth rate of real GDP in the United States rises from 4.2% to 4.4%.Explain and calculate how this increase in the growth rate of real GDP affects the number of years it will take for real GDP to double.

According to the "Rule of 70," how many years will it take for real GDP per capita to double when the growth rate of real GDP per capita is 5%?

If GDP grew 3% in 1970,2.2% in 1971 and 2.5% in 1972 then,what is the average annual growth rate over this period?

What is human capital?

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

Inflation is measured

Figure 14-3 -Refer to Figure 14-3.Which of the following is consistent with the graph depicted above?

Explain why increasing the government budget deficit can decrease investment spending.

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