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WorksheetsAP MACROECONOMICS UNIT 1
Total questions: 20
Worksheet time: 10mins
How do we calculate Real GDP?
Price Index = Price of the market basket/price of the same basket times 100
nominal GDP / real GDP
nominal GDP /price index(in hundredths)
CPI(year 2) - CPI(year 1)/CPI(year 1) times 100
What is the consumer price index formula?
nominal GDP /price index in hundredths
nominal GDP/ real GDP
Price of the market basket/price of the same basket times 100
What is the GDP deflator formula?
Price of the market basket/price of the same basket times 100
nominal GDP / real GDP
nominal GDP /price index
Are used goods counted in GDP?
No
Yes
Are stocks counted in GDP?
NO
YES
Who gains from Unanticipated inflation?
borrowers
sellers
Who is hurt by unanticipated inflation?
savers
lenders
people on fixed incomes
all of them
What is the difference between real GDP and nominal GDP?
Real GDP is adjusted for price changes; nominal GDP is not adjusted for price changes
nominal GDP is adjusted for price changes; real GDP is not adjusted for price changes
The base year is always ......
1
25
50
75
100
If the price index is greater than 100, there is ....
inflation
deflation
What is a method to calculate GDP of year x ?
quantity of good produced in year x times base prices
nominal /price index in hundredths
both
How do you calculate nominal GDP ?
quantity of good produced in year x times base prices
price times quantity of everything added up
neither
Which of the costs of inflation does the following statement illustrate?, " When there is inflation, grocery stores have to update the prices associated with the bar codes on their products."
menu costs
shoe leather costs
unit of account costs
nominal costs
time costs
When the actual inflation rate is greater than the anticipated inflation rate, which of the following is most likely to suffer?
retired persons with a cost of living adjustment in their benefits
those who lend with flexible interest rates
those who lend at a fixed interest rate
Unexpected increases in inventories usually precede...
decreases in production
decreases in unemployment
increase in imports
decreases in production/ recession
What type of unemployment would increase if workers lost their jobs because of a recession?
cyclical
frictional
seasonal
search
In 1 year, spending on consumption, investment, and government purchases was equal to 103 percent of a country's gross domestic product. This would be possible if only if...
the money supply increases
net exports are (+)
net exports are (-)
the government ran a budget surplus
Which of the following is a leakage from the circular flow of economic activity?
saving
investment
exports
government spending
income
Suppose a factory added 5k worth of output this year. Incidentally, the waste from this factory caused 1k worth of loss to the neighboring waterways. As a result, gross domestic product will...
increase by 1k
decrease by 1k
increase by 5k
decrease by 4k
Which of the following is true if real GDP in Year 1 is 5000 and in Year 2 is 5200?
the economy is experiencing a recession
the economy is experiencing 4 percent inflation
output change is uncertain
output has declined by 4 percent
output has increased by 4 percent
