Chapter 13 Measuring the Economy Quiz

What is the definition of inflation?

• A decrease in the overall price level

• An increase in the overall price level

• A stable price level

• A decrease in GDP

What does GDP stand for?

• Gross Domestic Product

• General Domestic Price

• Global Domestic Policy

• Gross Domestic Price

What is the unemployment rate?

• The percentage of the labor force that is employed

• The percentage of the labor force that is not employed but is actively seeking work

• The percentage of the population that is retired

• The percentage of the population that is underemployed

What is a recession?

• A period of economic growth

• A period of declining national economic activity

• A period of stable economic activity

• A period of hyperinflation

What must be true for goods and services to be included in a country's GDP?

• They must be produced within the country's borders

• They must be exported

• They must be imported

• They must be produced by American-owned companies

What is the role of economic indicators?

• To assess a nation's overall economic health

• To measure the total land area

• To calculate the population growth

• To determine the number of businesses

Which component of GDP is the largest according to the diagram?

• Business investment

• Government purchases

• Household consumption

• Net exports

What does the graph in Figure 13.2B compare?

• GDP of different countries

• Nominal and real GDP over several years

• GDP per capita

• GDP growth rates

What is an informal economy?

• An economy without government regulation

• A highly regulated economy

• An economy with high taxes

• A government-controlled economy

What is an example of GDP ignoring informal exchanges?

• Barter transactions

• Stock market trades

• Retail sales

• Government contracts