Macroeconomics Exam

GDP is the total market value of:

• all expenditures on natural resources, labor, and capital goods in an economy in a given year.

• all expenditures on consumption, investment, and net exports in an economy in a given year.

• all intermediate goods and services produced in an economy in a given year.

• all final goods and services produced within a nation's borders in a given year.

A period of decline in total output, income, employment, and trade, lasting six months or longer, is defined as a:

• trough.

• recession.

• business cycle.

• secular trend.

A headline in the New York Times reads: “Thousands of U. S. auto makers lose jobs to workers in Mexico.” After reading it you realize this story is a perfect example of ________ unemployment.

• frictional

• seasonal

• cyclical

• structural

What is Consumer Price Index used for?

• to measure Market Structures

• to measure GDP in order to determine rate of inflation

• measures changes in price of goods and services and determines inflation rate

• measures money and measures products at the same time

GDP, growth, business cycles, and unemployment are all central topics in:

• microeconomics.

• macroeconomics.

• utility theory.

• wage determination.

Which is included in the measure of GDP?

• spending on meals by consumers at restaurants

• spending on used clothing by consumers at garage sales

• the monetary value of stocks and bonds owned by investors

• the monetary value of used trucks purchased by construction companies

Exports minus imports may be defined as:

• net imports.

• net exports.

• net investment.

• foreign exchange.

The best example of a "frictionally unemployed" worker is one who:

• reduces productivity by causing frictions in a business.

• is laid off during a recessionary period in the economy.

• is in the process of voluntarily switching jobs.

• is discouraged and not actively seeking work.

Inflation is a rise in:

• the general level of prices over time.

• the standard of living over time.

• industrial production.

• real GDP.

Monetary policy in the United States is the responsibility of the:

• U.S. Treasury.

• Federal Reserve.

• Internal Revenue Service.

• Office of Management and Budget