Economics GDP and Business Cycles

Which of the following is NOT a cause of inflation

• higher resources costs

• aggregate demand increasing faster than productive capacity

• price expectations

• unemployment

The producer price index measures the average change in price during a time period of raw materials bought by producers.

• True

• False

Which is the formula to determine Gross Domestic Product?

• Consumption + Business costs + Government Expenditures + Net exports/imports

• Consumption + Investment + Government Expenditures + Net exports/imports

• National Income + Investment + Gov. Exp. + Net exports/imports

• Consumtption + Investment + Gov. Exp. + Exports

What is Real GDP mean?

• GDP expressed in today's dollars

• GDP divided by everyone in the country

• GDP adjusted for price changes from a base year.

• Net national product plus gross domestic income

Which of these is correct about population in the U.S.

• our population is getting younger on average

• the center of the nation's population has been moving eastward since colonial times

• More and more people are moving to the countryside

• Our population is growing at a fairly low rate

GDP does not include

• sales of used cars

• business investment

• government expenditures

• niether exports nor imports

The U.S. has the largest GDP in the world, except for China.

• true

• false

During a recession, GDP does what?

• increases for at least two quarters

• decreases for one month

• increases for one month

• decreases for at least two quarters

During an expansion which is true?

• High unemployment

• deflation

• lower unemployment

• GDP is stable

Which of the following is NOT an influence on the business cycle?

• external shocks

• speculation and "bubbles"

• fiscal policy of the government

• Net national income