Macro Review

If something is measured in "real" terms, it accounts for:

• Inflation

• Interest

• GDP

• No drama

As the price of goods increases due to inflation, what happens to the purchasing power of your money?

• It increases

• It decreases

• It stays the same

• Hyperinflation

The Consumer Price Index (CPI) is used to calculate the rate of inflation, and measures ________.

• the prices of food and rent only.

• Index funds in the stock market.

• the rate of interest.

• the prices of a basket of products purchased by the average consumers of a country.

Which of these situations would be "frictional" unemployment?

• Student just graduated from school and is taking a few weeks to find the right job.

• Robots have replaced your job and you need to return to school.

• A huge recession has happened and a lot of people were laid off.

• All of the above.

Which of the following are calculated in Gross Domestic Product (GDP)?

• Consumer spending

• Government spending

• Investment spending

• All of the above

Gross Domestic Product (GDP) measures _______.

• The distribution of goods and services across a country's population

• The level of employment in a country

• The total value of all goods and services produced in a country in a specific period of time (usually a year)

• The general price level in a country

37 year old "discouraged worker", who has given up looking for work after months of trying and failing to find employment.

• Employed

• Unemployed

• Not in the Labor Force

• Underemployed

During an expansionary period in the business cycle, what happens to unemployment?

• It goes up

• It goes down

• It is unchanged

During the recessionary period of the business cycle, what likely happens to inflation?

• It goes up

• It goes down

• It stays the same

Anywhere _____ the economic growth line is considered an inflationary gap.

• Above

• Below

• Inside of

• Around