WorksheetsUnit 2: Economic Indicators and the Business Cycle
Total questions: 38
Worksheet time: 21mins
Which of the following is included in gross domestic product?
Allison paints her own bicycle
Kate buys a new bicycle
Nolan buys a share of stock in a coffee company
Chuck bikes to school everyday
The table below shows the data for Country Y in 2024. The country’s gross domestic product is
$220 billion
$282 billion
$309 billion
$347 trillion
The country of Islerland produces only two goods, ham and cheese. The prices and final quantities produced of the two goods in 2008 and the base year of 2007 are shown in the table below. What are the nominal GDP and real GDP in 2008?
Nominal GDP is 74,RealGDPis 96
Nominal GDP is 70,RealGDPis 96
Nominal GDP is 96,RealGDPis 90
Nominal GDP is 96,RealGDPis 74
Which of the following individuals is classified as unemployed?
A laid-off computer programmer who has given up looking for a job
A parent who works in after school child care for 15 hours a week
A recent college graduate who is looking for her first job
A mayor who lost an election and retired
Brennan has just graduated from college and is now interviewing for jobs. Brennan would best be described as
Cyclically unemployed
Frictionally unemployed
Not in the labor force
A discouraged worker
The consumer price index (CPI) is designed to measure changes in the
Spending patterns of urban consumers only
Spending patterns of Marta and Joslyn
Wholesale price of manufactured goods
Cost of a select market basket of goods and services
Which of the following is true regarding inflation?
Inflation decreases the purchasing power of a country's currency
Inflation causes unemployment
When inflation increases, nominal interest rates decrease
Unanticipated inflation benefits lenders
The major difference between real and nominal gross domestic product is that real GDP
Excludes imports
Is adjusted for inflation
Measures only the value of final goods and services that are consumed
Excludes Slim Shady
If CPI last year was 175 and the CPI this year is 185, what is the rate of inflation? (round)
4%
6%
10%
Inflation is out of control
Nominal gross domestic product is best defined as
The market value of final goods and services produced in a nation in a given year
The base-year value of total goods and services produced in a nation in a given year
The market value of all goods and services consumed in a nation in a given year
The base-year value of goods and services consumed in a nation in a given year
Which of the following transactions will be included in the calculation of Fisherland Gross Domestic Product in 2022?
The sale of corporate stocks
The exchange of a used automobile for a used boat
The purchase of new construction machinery
Social Security checks received by retirees
Which of the following groups of people benefit from unanticipated inflation?
I. Savers
II. Borrowers
III. Lenders
I only
II only
I and II only
All of them
If the Price of the Market Basket in 2008 is 40andthePriceoftheMarketBasketinthebaseyearis 20, what is the CPI for 2008?
2
60
80
200
Which year is the base year?
1997 CPI=95
1998 CPI = 97
1999 CPI = 100
2000 CPI = 104
1997
1998
2000
1999
Types of Unemployment
Frictional Unemployment
Trying to find a job.
Cyclical
Unemployment
Mirrors Economy
Seasonal Unemployment
Mirrors the seasons demands
Structural Employment
Skills do not match available jobs
Under Employment
Working but still not making enough.
Match the following type of unemployment.
When people are fired, laid off, or quit, there is an inevitable period of time in which they must look for a job.
Frictional
Occurs when there is a surplus of laborers in a particular job market because the wage rate is too high.
Structural
These are changes in the unemployment rate caused by fluctuations in the business cycle.
Cyclical
Refers to workers who have short-term jobs based on the season.
Seasonal
A person who has never worked but is seeking employment (a)
Which of the following is a measure of the total economic output of a country?
Unemployment Rate
Inflation Rate
Gross Domestic Product (GDP)
Consumer Price Index (CPI)
What does GDP stand for?
Gross Domestic Product
General Domestic Product
Gross Development Product
General Development Product
How do economists calculate GDP per capita? Create the correct formula using the "divided by" symbol.
Match the following from this equation: C + I + G + (X − M) = GDP
Personal Consumption Expenditures, also known as consumer spending
C
Gross Private Investment (ex: business spending on fixed assets like machinery, equipment and buildings)
I
Federal, state and local government spending for the provisioning of goods and services—from schools and roads to national defense.
G
exports (goods made in the U.S. that are sold outside of the U.S.)
X
imports (goods made outside the U.S. that are sold in the U.S.)
M
Is this counted in the GDP of the US?
Cars made by a Japanese company in California.
Yes
No
Is this counted in the GDP of the US?
A farmer's purchase of a new tractor.
Yes
No
Which of the following is NOT part of GDP:
a new car that is sold
a teacher working in the classroom
a used TV on Craigslist
no answer
Based on the graph, which year shows a trough in the business cycle? (EPF.E.2.4)
2007
2008
2009
2010
What is a recession?
A period of economic growth
A period of economic decline
A period of high inflation
A period of high employment
The table above gives population and labor-market data for an economy. The unemployment rate in this economy is
3.3%
5%
10%
33.3%
50%
Which of the following best describes an economy at full employment?
The rate of unemployment is zero.
There is only structural and cyclical unemployment.
There is only cyclical unemployment.
There is cyclical, but not structural, unemployment.
There is frictional & structural unemployment, but not cyclical, unemployment.
The population of Country X is 250,000, and the labor force is 200,000 persons. If 175,000 people are employed, what is the unemployment rate?
10%
12.5%
20%
80%
87.5%
What is the nation's labor force?
3 million
9 million
100 million
150 million
91 million
What is the nation's actual unemployment rate?
4%
5%
6%
9%
66.7%
Based on the information in the table above, what is the unemployment rate for Country X?
3.3%
4.0%
6.0%
6.38%
7.5%
