Unit 5 Flashcards
(50 cards)
How is nominal GDP converted into real GDP?
Through eliminating the effects of prove increase in GDP growth
What is the difference between a recession and a depression?
A depression is a particularly deep recession with high levels of unemployment
According to the demand-pull theory, what is responsible for inflation?
Demand for goods and services exceeds existing supply
Economists look in which of the following explanations for inflation?
Too much money in the economy, producers raise prices in order to meet increased costs, and the demand for goods exceeds supply, like in wartime
All of the following measures beep to promote technological progress EXCEPT…
Increase wages for researchers
I’m an economy, when the price level falls, consumers and firms buy more goods and service. This relationship is represented by the …
Aggregate demand curve
What is the difference between seasonal unemployment and structural unemployment?
Seasonal unemployment occurs because of schedules, whereas structural occurs because people lack skills
If the number of people employed is 150,000 and the labor force is 160,000 the unemployment rate is…
6.25%
When plotted on a Lorenzo Curve, the income distribution curve for the town of Lakeview is a straight line from 0% to 100%. This means that…
Everyone in Lakeview earns about the same income
The main economic variable that affect business cycles include all of the following EXCEPT…
Personal savings levels
The amount of money a person has left of his or her income after taxes is called…
Disposable personal income
What is an example of a positive external shock to aggregate supply?
Good weather leads to an unusually productive harvest for corn farmers
What does it mean when a person is underemployed?
The person has a job but they are overqualified for it
Which of the following might cause the inflation rate to spike up sharply?
Prices in world oil markets rise steeply due to war in the Middle East
Products that would be used in calculating GDP include…
Cars manufactured in Tennessee at a factory owned by a Japanese automobile company
The calculation of GDP would include…
The income of a high school English teacher
Concern about an international crisis has caused consumers to save their money and postpone big purchases. What is the effect on aggregate demand and aggregate supply?
Aggregate supply will decrease, raising the price level and lowering real GDP
When the economy is working properly, what is the unemployment rate?
4 to 6 percent
When Alison, a college math professor, leaves her job at a small rural college and starts looking for a job at a large urban university, she is…
Friction ally unemployed
The agency that maintains that National Income and Product Accounts (NIPA) is…
The US Department of Commerce
If no foreign companies produce in a country, but many of the country’s companies build products in foreign countries, then it is safe to say that…
The county’s GNP is greater Jan is GDP
As you move from left to right, the aggregate demand curve…
Slopes downward
According to the cost-push theory, what is responsible for inflation?
Producers raise prices to meet increased cost
What is the possible consequence of the following scenario? Because of high unemployment rates In the country Lavernia, employers offer higher wages. To meet their higher payroll costs and maintain profits, they charge consumers more for goods and services
A wage price spiral of ever-increasing prices
