Macroeconomics Clicker Questions Chapter 2 Steve values his car at 4 000 Jen values it at 9 000 If Jen buys it from Steve for 7 000 which is true o Steve gains 3 000 of value and Jen gains 2 000 When private ownership of a resource is clearly defined and enforces the private owner o has a strong incentive to use the resource wisely and consider seriously the wishes of others when deciding how to employ the resources In the fictitious country of Lebos the government allows private ownership of pigs but not cows If demand for pork and beef both permanently increase long run we expect o Population of pigs will rise population of cows will fall Using a PPC Production Possibility Curve a technological advance that increaseas the amount of output for the same amount of input would be illustrated as o An outward shift in the curve Opportunity costs differ among nations primarily because o Nations have different endowments of land labor ect When voluntary trade occurs which statement is most accurate o Both gain some value Chapter 3 In economics the demand for a good refers to the amount of good people o Are willing to buy at various prices When economists say that the quantity demanded of a product has increased o Price of the product has fallen and consequently consumers are When economists say that the demand for a product has decreased they they mean buying more mean o The demand curve has shifted to the left Ceteris Peribus an increase in the price of a good will cause the o Quantity supplied of the good to increase When economists say the supply of a product has increased they mean o The supply curve has shifted to the right Which of the following statements are true o With a shortage quantity demanded exceeds quantity supplied and o With a surplus quantity supplied exceeds quantity demanded and price will be pushed up price will be pushed down If there is a decrease in demand for laptops we would expect o Both price and demand sold to decrease Which of the following would reduce the price of DVD players and increase the quantity sold o An increase in the supply if there is a simultaneously an increase in demand and supply we would expect quantity quantity o An increase in equilibrium price and an increase in equilibrium o A decrease in equilibrium price and an increase in equilibrium Adam Smith s invisible hand principle stresses o The tendency of the competitive market process to direct self interested individuals into activities that enhance the economic welfare of society Chapter 7 A business produced 10 million of goods in 2005 but sold only 9 million Is the 1 million increase in inventory counted as part of the 2005 GDP o Yes because these inventories are part of the output of the economy in 2005 George lived in a home that was newly constructed in 2005 In 2005 he paid 200 000 for the brand new house He sold the house in 2006 for 225 000 Which statement is correct o The 2006 sale affected neither 2005 GDP nor 2006 GDP Y C I G X which of the 4 is the largest component of GDP o Consumption for 8 000 the If a used car dealer purchases a used car for 3 000 refurbishes it and sells it o Dealer contributes value added equal to 5 000 and consequently 5 000 is added to GDP An American owned McDonald s opens in Russia How would the net revenue earned by this restaurant affect the GDP and GNP of the U S o GDP would remain unchanged o GNP would rise Gasoline prices are lower now than they were in 1980 o False true If the GDP deflator in 2006 was 130 compared to a value of 100 during the 1996 base year this would indicate o The general level of prices during 2006 was 30 percent higher than during 1996 Chapter 8 A person not working is considered unemployed Mary is a homemaker Last week she was busy with her normal household o False chores She is o Not a member of the labor force Which of the following is a positive effect on job search and the unemployment that often accompanies it o It permits individuals to better match their skills and preferences with the requirements of a job Full employment is the situation in which the economy operates at an unemployment rate equal to the sum of o Structural and frictional unemployment Chapter 9 For a economy AD equals imports o Y C I G X o Consumption plus investment plus government purchases exports Other things constant an increase in resource prices will o Increase the cost of producing goods and services which will lead to a higher price level Which is the most accurate statement about real and nominal interest rates o Real interest rates can be either positive or negative but nominal interest rates must be positive If the dollar price of the English pound goes from 1 75 to 1 50 then o The dollar has appreciated against the pound o The pound has depreciated against the dollar If the dollar price of the English pound goes from 1 75 to 2 00 then o English will find American goods cheaper Chapter 10 Which will increase aggregate demand o A lower real interest rate productivity of labor this will o Increase SRAS and LRAS Increase in resource prices will If an improvement in the quality of education in the U S increases the o Decrease short run aggregate supply Which of the following will most likely occur as the result of an unanticipated increase in aggregate demand o An increase in output and a move to a higher price level Which of the following will most likely accompany an unanticipated increase in aggregate demand o An increase in the price level o An increase in resource prices o An increase in real GDP o Dollar will appreciate For an oil importing country such as the U S the immediate effect of a supply shock caused by an increase in the price of imported oil would tend to o A decrease in real output o An increase in the general level of prices In the aggregate demand supply model when the output of an economy is less than its long run potential the economy will experience o Declining real wages and interest rates that will stimulate employment and real output Chapter 11 A hail storm that breaks lots of windows in buildings is o Bad for the economy because wealth was destroyed and more spending on repairs will result in less spending on other goods and services Within the Keynesian model the multiplier effect tends to o Magnify small changes in spending into much larger changes in output What is the difference between the national deficit and the national debt o The deficit is a yearly amount o The debt is a cumulative amount o The
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