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WorksheetsMacro Unit 1
Total questions: 126
Worksheet time: 3hrs 30mins
In calculating GDP of that sector, we know that the total value added of that sector is .......
$3.5
$10.0
$15.5
$31.0
Daffa buys stock $1,000. He has to pay $50 for broker fee. How much can be counted in GDP?
$1000 (only the stock)
$1050 (stock + broker fee)
$0 (neither stock nor broker fee)
$50 (only the broker fee)
Which of these following example can be counted in GDP?
Your grandmother wins $10 million in the lottery
Company A takeover by purchasing all the assets of Company B
Buy mozzarella cheese to store it as restaurant's inventory
You buy a used copy of this textbook
Gross National Product minus Net National Product is called ...
Net National Product
Gross Domestic Product
Indirect Tax
Depreciation
Gross National Product minus Net National Product is called ...
Net National Product
Gross Domestic Product
Indirect Tax
Depreciation
Please calculate Nominal GDP in 2017...
$6.7
$5.1
$8.4
No answers are correct
How much Deflator GDP in 2018?
100
123.45
125.37
127.35
Please calculate economic growth from the data above!
37.13%
33.17%
30.37%
31.37%
The term when govt budget deficit raising real interest rate and decrease investment is called
Ricardo-barro effect
Crowding - in effect
Multiplier effect
Crowding - out effect
if we pay tax and consume goods, but still have money left, we keep the money in the bank as
Private Saving
Public Saving
National Saving
Investment Saving
Which one is considered to be business fixed investment?
Build a new house
Increase stock in warehouse
Build a new factory plant
Buy a sharia mutual fund
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
Are used goods 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
Consider a country that can produce only two goods: cars and computers. The country is currently operating on its Production Possibility Curve (PPC). If the country decides to produce more cars, what is the opportunity cost of this decision?
The additional resources needed to produce more cars.
The decrease in the production of computers.
The increase in the production of both cars and computers.
The total cost of producing cars.
A new technology is introduced that makes the production of both goods more efficient. How would this affect the Production Possibility Curve (PPC) of an economy?
The PPC would shift inward.
The PPC would remain unchanged.
The PPC would shift outward.
The PPC would become a straight line.
Assume the market for smartphones is initially in equilibrium. If there is a sudden increase in consumer income and smartphones are a normal good, what is the likely effect on the equilibrium price and quantity of smartphones?
Equilibrium price will decrease, and equilibrium quantity will increase.
Equilibrium price will increase, and equilibrium quantity will decrease.
Equilibrium price and quantity will both increase.
Equilibrium price and quantity will both decrease.
A government imposes a price ceiling on rental apartments below the current equilibrium price. What is the most likely outcome in the rental market?
A surplus of rental apartments.
A shortage of rental apartments.
No change in the rental market.
An increase in the quality of rental apartments.
If the demand for a product is price elastic, what would be the effect of a price increase on the total revenue of the firm selling the product?
Total revenue would increase.
Total revenue would decrease.
Total revenue would remain unchanged.
Total revenue would first increase, then decrease.
A country is considering reallocating resources from the production of consumer goods to capital goods. What is the long-term impact of this decision on the country's economic growth?
Economic growth will decrease.
Economic growth will remain unchanged.
Economic growth will increase.
Economic growth will first decrease, then increase.
Consider a market where the supply curve is perfectly inelastic. If there is an increase in demand, what will happen to the equilibrium price and quantity?
Equilibrium price will increase, and equilibrium quantity will remain unchanged.
Equilibrium price will decrease, and equilibrium quantity will increase.
Equilibrium price and quantity will both increase.
Equilibrium price will remain unchanged, and equilibrium quantity will increase.
If a country is operating inside its Production Possibility Curve (PPC), what does this indicate about the country's resource utilization?
The country is using all its resources efficiently.
The country is experiencing economic growth.
The country is not using all its resources efficiently.
The country is producing at maximum capacity.
In the context of opportunity cost, which of the following scenarios best illustrates the concept?
A student chooses to study for an exam instead of going to a movie.
A company increases its production of goods without any additional cost.
A government decides to print more money to stimulate the economy.
A farmer uses a new type of fertilizer to increase crop yield.
How would an increase in the price of a substitute good affect the demand for a product?
Demand for the product would decrease.
Demand for the product would increase.
Demand for the product would remain unchanged.
Demand for the product would first decrease, then increase.
What does point B represent?
Production at greater than the country's minimum potential
Production is less than the country's minimum potential
Production is greater than the country's maximum potential
Production at the country's maximum potential
What does point B represent?
Production at greater than the country's minimum potential
Production is less than the country's minimum potential
Production is greater than the country's maximum potential
Production at the country's maximum potential
The following diagram shows the production possibility frontier for an economy that produces bread and honey.
If the economy is initially at point W, then the opportunity cost of moving to point X is
6 units of honey.
8 units of honey.
12 units of bread.
23 units of bread.
The table shows the production possibilities for a country. Based on the table, which of the following production combinations is a possibility?
5 pairs of shoes and 28 pizzas
3 pairs of shoes and 23 pizzas
2 pairs of shoes and 20 pizzas
4 pairs of shoes and 15 pizzas
Products that we usually use/consume together.
Complements
Substitutes
Related goods
Pairs
Products that we can use instead of each other.
Complements
Substitutes
Related goods
Pairs
Which graph shows an increase in demand?
1
2
3
4
Which graph shows an increase in the quantity demanded?
1
2
3
4
If demand for a good decreases when people's income increases
The good is an inferior good
The law of demand is violated
The good is a normal good
The good's demand curve is upward sloping
New technology advances the rate at which furniture can be assembled. Why does this change the supply?
Change in cost of production
Changes in number of producers
Changes in expectations
If only the price for a good or service changes, does the demand curve shift? Why or why not?
Yes, Price shifts the demand curve to the right because less people are being goods
Yes, Price shifts the demand curve to the left because more people are buying goods
No, Because price does not shift the curve. Price stays on the line
No, because price does not impact the points on the curve
Yes and No. The price shifts the curve sometimes, but not always
When quantity supplied is smaller than quantity demanded, you have a ____________.
shortage
surplus
deficit
equilibrium
What is the difference between a shortage and scarcity?
A shortage is temporary but scarcity always exists
A shortage results from rising prices; scarcity results from falling prices
A shortage is lack of all goods and services; scarcity concerns a single item
There is no real difference between a shortage and scarcity
Unlimited wants, limited resources
Revenue
Scarcity
Marginal Cost
Opportunity Cost
The study of choices a society makes in response to scarcity
Marginal Cost
Utility
Trade-offs
Economics
The most desirable alternative given up when a choice is made:
Theoretical Economics
Opportunity Cost
Marginal Analysis
Marginal Economics
The producer that can produce the most output or require the least amount of resources for production is:
Input
Output
Absolute Advantage
Comparative Advantage
The producer with the lowest opportunity cost.
Example: The only one country can have the __________ in one good, but never both.
Normative Statements
Comparative Advantage
Absolute Advantage
Marginal Benefit
Allie is shopping when she finds a pair of running shoes priced at $90. When Allie uses her debit card to pay, it is declined because her balance is insufficient to cover the cost of the running shoes. Allie's situation best illustrates which economic concept?
opportunity cost
trade
unlimited resources
scarcity
trade
A city government received a $1 million grant to build swimming pools and skating rinks for youth. Based on the data provided in the graph, what is the opportunity cost of building one swimming pool.
.50 skating rink
.50 swimming pool
2 skating rinks
2 swimming pools
5 skating rinks
The table above shows the maximum amount of trucks or coffee that China and Malaysia can produce using the same amount of resources. Based on the data provided, which of the following terms of trade are mutually beneficial for the two countries?
1 ton of coffee for 3 trucks
1 ton of coffee for 4 trucks
1 ton of coffee for 5 trucks
1 truck for 1 ton of coffee
1 truck for 5 tons of coffee
Home Nation can produce five autos or one hundred computers using all its available resources in a year. Foreign Nation can produce five autos or fifty computers using all its available resources in a year.
Based on the information provided above, which of the following are mutually beneficial terms of trade at which both Home and Foreign Nation will be willing to specialize and exchange?
1 auto for 1 computer
1 auto for 10 computers
1 auto for 17 computers
1 auto for 20 computers
1 auto for 25 computers
Which of the following statements is accurate given the chart?
Country B has an absolute advantage in the production of cars and a comparative advantage in the production of bikes.
Country B has an absolute advantage in the production of cars and a comparative advantage in the production of cars.
Country A has an absolute advantage in the production of cars and a comparative advantage in the production of bikes.
Country A has an absolute advantage in the production of bikes and a comparative advantage in the production of bikes.
Country A has an absolute advantage in the production of both goods.
If two nations specialize according to their individual comparative advantages and engage in trade, then which of the following must be true?
Nations would be better off if they were self-sufficient.
If one nation gains from trade with the other nation, then the other nation will lose.
Both nations can consume only what they produce.
Both nations can consume beyond their individual production possibilities.
Both nations will lose from trade.
Based on the information in the table above, which of the following is true?
Peru has a comparative advantage in producing wheat.
Peru has an absolute advantage in producing wheat.
Brazil has an absolute advantage in producing wheat.
Peru has a comparative advantage in producing coffee.
Brazil has a comparative advantage in producing coffee.
Which of the following is always true of an economy operating on its production possibilities frontier?
It will necessarily operate on the same frontier the following year.
It cannot trade with other nations because it is the most efficient producer of tradeable goods.
It is allocatively efficient.
Its resources are fully employed.
It must be a command economy.
In Mars, the opportunity cost of obtaining the first two units of food is how many units of clothing?
In Venus, the opportunity cost of the first unit of
Which of the following statementsis correct based on the concept of comparative advantage?
The diagram represents a(n)
increase in supply
decrease in supply
change in quantity supplied
none of the above
The diagram represents a
increase in demand
decrease in demand
change in quantity demand
none of the above
What does point B represent?
Production at greater than the country's minimum potential
Production is less than the country's minimum potential
Production is greater than the country's maximum potential
Production at the country's maximum potential
What is the Opportunity Cost of moving from C to A? (Think in the terms of what do we have to forgo in the process.)
(a)
The following diagram shows the production possibility frontier for an economy that produces bread and honey.
If the economy is initially at point W, then the opportunity cost of moving to point X is
6 units of honey.
8 units of honey.
12 units of bread.
23 units of bread.
The table shows the production possibilities for a country. Based on the table, which of the following production combinations is a possibility?
5 pairs of shoes and 28 pizzas
3 pairs of shoes and 23 pizzas
2 pairs of shoes and 20 pizzas
4 pairs of shoes and 15 pizzas
Products that we usually use/consume together.
Complements
Substitutes
Related goods
Pairs
Products that we can use instead of each other.
Complements
Substitutes
Related goods
Pairs
Which graph shows an increase in demand?
1
2
3
4
Which graph shows an increase in the quantity demanded?
1
2
3
4
If demand for a good decreases when people's income increases
The good is an inferior good
The law of demand is violated
The good is a normal good
The good's demand curve is upward sloping
If the demand for flat screen TV's increase when consumers income rise, then TV's are
A normal good
An inferior good
A substitute good
A complement good
New technology advances the rate at which furniture can be assembled. Why does this change the supply?
Change in cost of production
Changes in number of producers
Changes in expectations
If only the price for a good or service changes, does the demand curve shift? Why or why not?
Yes, Price shifts the demand curve to the right because less people are being goods
Yes, Price shifts the demand curve to the left because more people are buying goods
No, Because price does not shift the curve. Price stays on the line
No, because price does not impact the points on the curve
Yes and No. The price shifts the curve sometimes, but not always
When quantity supplied is smaller than quantity demanded, you have a ____________.
shortage
surplus
deficit
equilibrium
Which of these demonstrates a surplus of goods?
What is the difference between a shortage and scarcity?
A shortage is temporary but scarcity always exists
A shortage results from rising prices; scarcity results from falling prices
A shortage is lack of all goods and services; scarcity concerns a single item
There is no real difference between a shortage and scarcity
This economic concept deals with facts and statistics
Normative Economics
Economics
Macroeconomics
Positive Economics
This economic concept deals with ethics and opinions
Normative Economics
Economics
Macroeconomics
Positive Economics
What is a Command Economy?
CAPITALISTIC economy in which there is free competition and prices are determined by interaction of supply and demand
An economic system COMBINING private and public enterprise.
When production, investment, price, and income are determined centrally by a GOVERNMENT.
A system that relies on customs, history, and time-honored beliefs.
Government involvement in a market economy is.
low
high
Other things being equal or constant.
Ceteris paribus
Citiris paribus
Ceteris parebus
Ceteris paribous
The Business Cycle measures ___ over time.
wealth
inflation
economic growth
The business cycle rises above the trendline during-
rescessions
expansions
troughs
Economic recovery begins-
above the trend line
at the end of a recession (trough)
at the "boom" period
If a news headline says, "3 months of consecutive job losses is impacting consumer confidence."
Where on the business cycle is the current economy?
Peak
Contraction/Recession
Trough
Expansion/Growth/Recovery
