Domestic Macroeconomic Goals

Which of the following best describes the government's goal or strong and sustainable economic growth?

• A growth rate in real GDP of approximately 3.25%

• The highest rate of economic growth without causing excessive inflation, external and environmental pressures

• The highest growth rate in real GDP that is possible

• The highest growth rate in real GDP without causing excessive inflation

Which of the following types of unemployment is not considered to be a component of the economy's natural unemployment levels?

• Cyclical Unemployment

• Seasonal Unemployment

• Structural Unemployment

• Frictional Unemployment

NAIRU = Non-Accelerating _ Rate of Unemployment

In relation to real GDP per capita, which of the following statements is INCORRECT?

• It is a measure of material living standards

• It is equivalent to the average amount of income for each Australian

• It will not always increase when GDP increases

• It is derived by dividing real GDP by the number of employees in Australia

The total market value of all goods and services over a given period of time is the definition of:

• Gross Domestic Product

• Consumer Price Index

• Gross National Income

• Underlying inflation

Which of the following best describes structural unemployment?

• When unemployment occurs due to insufficient levels of structural demand in the economy

• When unemployment occurs due to insufficient skills held by the unemployed

• When unemployment occurs due to a change in the structural component of the budget

• When unemployment occurs due to changes in AD

Which of the responses below is the most accurate way of calculating the underutilisation rate from the data?

• (2000/13000)x100

• (3000/130000) x100

• (3000/120000) x100

• (3000/150000) x100

Which of the following is LEAST correct regarding the relationship between the unemployment rate and the participation rate?

• An increase in the participation rate can reduce the unemployment rate

• An increase in the participation rate can increase the unemployment rate

• An increase in the unemployment rate is likely to increase the participation rate

• There is no relationship

Which of the following is most likely a consequence of high unemployment?

• Lower labour costs as the labour market loosens

• Increased incomes & higher purchasing power

• Reduced incidence of crime and poverty

• Increased income equality

High inflation will do all of the following except...

• Erode purchasing power

• Cause more spending to be devoted to future consumption

• Reduce international competitiveness

• Increase cost of living