AP Macro Unit 2 Review

Each individual on food stamps in Delaware can receive up to $194 a month. Is this included in government spending?

• Yes - Government spending

• Yes - Consumer Spending

• No - Intermediate Goods

• No - Transfer Payment

Mr. Johns is quitting his job as a teacher and moving to california. He is

• Cyclically unemployed
• Seasonally Unemployed
• Structurally Unemployed
• Frictionally Unemployed

The unemployment rate does not account for which two types of people?

• discouraged workers (hidden unemployed) and those employed
• full time carers and those in school
• retirees and those in prison
• discouraged workers (hidden unemployed)  and underemployed

Who is most likely to be hurt by inflation?

• someone who borrowed money
• a retiree on a fixed income
• a business owner
• the U.S. government

Which of the following would not affect the size of real GDP?

• Consumer purchase of a new car for personal use.
• Government purchase of a new car for the military
• Consumer purchase of a rare renaissance painting. 
• Business purchase of a new car for a delivery vehicle.

Which of the following people would be considered structurally unemployed? 

• Unemployed auto assembly line factory worker during a recession.
• A high school student who mows lawns during the summer, but is out of work because it is winter
• An auto assembly line worker who quit her job to go back to school full-time to improve her job skills
• Unemployed auto assembly line factory worker who was replaced with a robot

Which of the following will most likely occur during the expansionary phase of the business cycle? 

• Real GDP rises and unemployment falls.
• Real GDP rises and unemployment rises. 
• Real GDP declines and inflation rises.
• Interest rates rise and the number of business failures rise. 

Frictional unemployment 

• would be eliminated if the economy were operating at full employment levels of GDP.
• is zero when we have achieved the Natural rate of unemployment.
• is present even when labor markets are working well.
• is the result of worker skills not matching the jobs available

What type of GDP is calculated with the current year's prices?

• Nominal GDP
• Real GDP
• GDP per capita
• Base Year GDP

Expectant parents buy supplies for the nursery.  Would this be included in GDP? 

• Yes - Consumer Spending
• Yes - Investment 
• No - Intermediate goods
• No - Non-market activity