Unit 3 Exam College

Question 1

Frictional unemployment

Answer 1

When workers spend time finding a job that suits their tastes and skills

Question 2

Consumption

Answer 2

The total spending by households on goods and services

Question 4

Employed

Answer 4

Paid employees, self-employed, and unpaid workers for a family business

Question 5

GDP Deflator

Answer 5

100 x ( Nominal GDP / Real GDP )

Question 6

CPI inclusion

Answer 6

Includes imported consumer goods

Excluded capital goods

Question 7

Cyclical unemployment

Answer 7

The deviation of employment from its natural rate

Question 7

Frictional Unemployment

Answer 7

When workers spend time finding a job that suits their tastes and skills

Question 8

Consumer Price Index formula

Answer 8

100 x ( cost of basket in current year/Cost of basket in base year )

Question 9

GDP Definition

Answer 9

The market value of all final goods and services produced in a country within a given period of time

Question 10

Human Capital ( H )

Answer 10

The knowledge and skills workers acquire through education, training, and experience

Question 11

GDP Deflator inclusion

Answer 11

Includes Capital Goods

Excludes imported consumer goods

Question 12

Inflation Rate

Answer 12

100 x [ ( CPI this year - CPI last year )/ CPI last year ]

Question 13

Money Multiplier

Answer 13

1/R

Question 14

Labor Force

Answer 14

The total number of workers, including unemployed and employed

Question 15

Natural Resources

Answer 15

The inputs into production that nature provides

Question 16

National Savings/ Investment

Answer 16

Y-C-G

Question 17

Government Purchases

Answer 17

Total spending on the goods and services purchased by the government at the federal, state, and local levels

Question 18

GDP Equation

Answer 18

Y=C+G+I+NX ( Cows get in X-rays yearly )

Question 19

Investment

Answer 19

Total spending on good that will be used in the future to produce more goods

Question 20

Labor Force Participation Rate

Answer 20

100 x ( Labor force / Adult population )

Question 21

Money Supply

Answer 21

The quantity of money available in the economy

Question 22

Net Exports

Answer 22

Exports-Imports

Question 23

Physical Capital

Answer 23

The stock of equipment and structures used to produce goods and services ( K )

Question 24

Natural Rate of Employment

Answer 24

The normal rate of unemployment around which the actual unemployment fluctuates

Question 25

Private Saving

Answer 25

Y-T-C

Question 26

Production Function

Answer 26

Y=A x F( L, K, H, N )

Question 27

Productivity

Answer 27

The average output of goods and services produced per unit of labor input ( Y / L )

Question 28

Public Saving

Answer 28

T-G

Question 29

Real Interest Rate

Answer 29

Nominal interest rate-Inflation rate

Question 30

Structural Unemployment

Answer 30

When there are fewer jobs than workers

Question 31

Technological Knowledge

Answer 31

Society’s understanding of the best ways to produce goods and services

Question 32

Unemployed

Answer 32

Adults ( 16+ ) not working who have looked for a job in the last 4 weeks

Question 33

Unemployment Rate

Answer 33

100 x ( # of unemployed / labor force )

Question 34

If a country’s saving rate increases, then in the long run

Answer 34

Productivity and real GDP per person is higher

Question 35

According to the definitions of national saving and private saving, if Y, C, and G remained the same, an increase in taxes would

Answer 35

Leave national saving unchanged and reduce private saving

Question 36

The language of macroeconomics, investment refers to

Answer 36

The purchase of new capital

Question 37

Property rights

Answer 37

The ability to exercise authority over the resources they own

Question 38

For an economy as a whole, income must equal expenditure because

Answer 38

Every dollar of spending by some buyer is a dollar of income for some seller