Unit 3: Macroeconomics Test

Output-Expenditure Model

GDP = Consumer C + Investment I + ? + Exports & Imports (X-M)

• Demand - D

• Taxes - T

• Product - P

• Government - G

The largest sector of the macroeconomy is the

• investment sector

• government sector

• foreign sector

• consumer sector

Gross domestic product after adjustments for inflation is known as

• Real GDP

• GDP Per Capita

• National GDP

• Current GDP

A U.S. business buys new computers for its office workers from a U.S. computer manufacturer. The value of the transaction would be included in which category in the graph?

• Consumer sector

• Investment sector

• Government sector

• Net Exports

GDP = C + I + G + (X-M)

In this model, the “(X-M)” represents the

• Total of the dollar value of goods sent abroad and goods purchased from abroad

• Difference between the dollar value of goods sent abroad and goods purchased from abroad

• Total investments in the United States by foreign nationals

• Total investments in other nations by US citizens

The business cycle since World War II has been characterized by

• extended expansions alternating with brief recessions

• brief expansions alternating with lengthy recessions

• uninterrupted expansion

• uninterrupted recession

Unemployment that is directly related to swings in the business cycle is

• frictional

  unemployment

• structural

  unemployment

• cyclical

  unemployment

• seasonal

  unemployment

Inflation in excess of 500 percent per year is called

• demand-pull

  inflation

• cost-push inflation

• stagflation

• hyperinflation

A statistical series used to measure price changes for a representative sample of frequently used household items is called the

• producer price index

• composite index of leading economic indicators

• consumer price index

• implicit GDP price deflator

Changes in technology and changes in consumer tastes can cause

• frictional unemployment

• structural unemployment

• cyclical unemployment

• seasonal unemployment