784 785 786 787 A key statistic to measure economic growth is the size of the government s budget Incorrect real GDP per capita True Answer Correct life expectancy Incorrect the Dow Jones stock market index Incorrect Scenario Price Index Suppose that in the base period a college student buys 20 gallons of gasoline at 2 per gallon 2 CDs for 13 each and 4 movie tickets for 7 each In the next month the price of gasoline is 2 25 per gallon CDs cost 12 50 each and the price of a movie ticket is 7 50 Reference Ref 22 12 Scenario Price Index The price index for the second month is 94 Incorrect 106 4 True Answer Correct 100 Incorrect impossible to determine without more information Incorrect Which of the following is an important measure of economic growth over time inflation Incorrect increases in real per capita GDP True Answer Correct decline in real interest rates Incorrect increases in the available labor supply Incorrect Scenario Price Index Suppose that in the base period a college student buys 20 gallons of gasoline at 2 per gallon 2 CDs for 13 each and 4 movie tickets for 7 each In the next month the price of gasoline is 2 25 per gallon CDs cost 12 50 each and the price of a movie ticket is 7 50 Reference Ref 22 12 Scenario Price Index The change in prices from the first to the second month is 7 6 Incorrect 94 Incorrect 6 4 True Answer Correct 788 789 790 791 792 6 Incorrect The best currently available measure of the standard of living in a country is the nominal GDP per capita Incorrect the real GDP per capita True Answer Correct the unemployment rate Incorrect the growth rate of productivity Incorrect In the country of Sildavia a market basket of goods and services cost 130 in 2009 140 in 2010 and 160 in 2011 Based on this information and considering 2009 to be the base year the price index in 2011 was 100 Incorrect 107 69 Incorrect 123 07 True Answer Correct 130 Incorrect A key measure used to track economic growth is real GDP per capita True Answer Correct nominal GDP Incorrect real GDP Incorrect nominal GDP per capita Incorrect In the country of Sildavia a market basket of goods and services cost 130 in 2009 140 in 2010 and 160 in 2011 Based on this information and considering 2009 as the base year inflation from 2009 to 2011 was 7 14 Incorrect 7 69 Incorrect 14 28 Incorrect 23 07 True Answer Correct If a country has a population of 1 000 an area of 100 square miles and a GDP of 5 million then its GDP per capita is 500 Incorrect 5 000 True Answer Correct 50 000 Incorrect 5 million Incorrect 79 3 794 79 5 796 Reference Ref 22 13 Table Market Basket of School Supplies The accompanying table shows the prices of three common school supplies in 2010 and 2011 and the quantities of each school supply that consumers bought in 2010 the base year If we were to construct a school supply index in 2011 it would be equal to 81 8 Incorrect 100 Incorrect 122 2 True Answer Correct 112 500 Incorrect Real GDP per capita in the United States increased almost twofold Incorrect threefold Incorrect eightfold True Answer Correct tenfold Incorrect between 1900 and 2010 Reference Ref 22 13 Table Market Basket of School Supplies The accompanying table shows the prices of three common school supplies in 2010 and 2011 and the quantities of each school supply that consumers bought in 2010 the base year If we were to construct a school supply index SSI to measure the rate at which average school supply prices have changed we would find an inflation rate of 22 True Answer Correct 122 Incorrect 82 Incorrect 18 Incorrect Today more than of the world s population lives in countries poorer than the United States was a century ago one fifth Incorrect 797 798 799 800 801 one third Incorrect one half True Answer Correct two fifths Incorrect If the cost of a market basket is 200 in year 1 and 230 in year 2 the price index for year 2 using year 1 as the base is 100 Incorrect 115 True Answer Correct 130 Incorrect 200 Incorrect A typical family in the United States in 1900 had a purchasing power equal to of the real U S GDP per capita in 2010 1 Incorrect 13 True Answer Correct 70 Incorrect 136 Incorrect If the cost of a market basket is 150 in year 1 and 200 in year 2 the price index for year 1 using year 2 as the base is 75 True Answer Correct 100 Incorrect 133 Incorrect 150 Incorrect Output per capita in the United States in 2010 was about how many times as great as in 1900 twice as high Incorrect three times as high Incorrect eight times as high True Answer Correct ten times as high Incorrect Suppose that the market basket for the university student price index USPI consists of 5 textbooks and 100 gallons of gasoline In 2010 the base year for this index textbooks cost 50 each and gas costs 1 per gallon In 2011 textbooks cost 80 each and gasoline costs 3 per gallon The USPI for 2011 is 100 Incorrect 150 Incorrect 200 True Answer Correct 802 803 250 Incorrect In the popular press we see many pictures of affluent people in Chinese cities Yet the average person in China today is poorer than the average person in America was in 2000 Incorrect 1970 Incorrect 1950 Incorrect 1900 True Answer Correct Suppose that the market basket for the University Student Price Index USPI consists of 4 textbooks and 100 gallons of gasoline In 2010 the base year for this index textbooks cost 50 each and gas costs 1 per gallon In 2011 textbooks still cost 50 each and gasoline costs 4 per gallon The USPI for 2011 is 250 Incorrect 200 True Answer Correct 150 Incorrect 100 Incorrect 804 The standard of living in a country can be best measured by nominal GDP per capita Incorrect real GDP per capita True Answer Correct the productivity growth rate Incorrect the business cycles Incorrect 805 The inflation or deflation rate is the change in a price index divided by the initial value of the index True Answer Correct the change in a price index divided by the new index number Incorrect the difference between the initial price index number and the new price index number Incorrect computed by dividing the old price index number by the new price index number Incorrect The in an economy whose aggregate real output is growing faster than the total population 806 real GDP per capita is rising True Answer Correct standard of living is declining Incorrect national income is falling Incorrect nominal GDP per capita is rising Incorrect Inflation can be measured by the percentage change in the CPI True Answer Correct the absolute change in the CPI
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