EX1-KEY - Economics 2006, Spring 2008, Exam 1 [1]Which of...

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Economics 2006, Spring 2008, Exam 1 [1]Which of the following indicates that the average standard of living (per capita output) is rising ? 1. Real GDP decreases faster than the price level. 2. Real GDP increases faster than the price level. 3. The population increases. 4. Real GDP increases faster than the population. 5. Population increases faster than real GDP. [2]If the unemployment rate is 6 percent, then 6 percent of 1. the population is not working 2. potential workers do not have jobs 3. the individuals who are looking for work cannot find jobs 4. people who want to work cannot find jobs 5. None of the above [3]Since World War II which of 1-3 is a false statement about the U.S. economy? 1. Per capita output has remained relatively constant. 2. In a typical year, the rate of inflation has been greater than zero. 3. The price level, measured, say, by the CPI has risen steadily. 4. Each of 1-3 is false. 5. Each of 1-3 is true. [4]Which of 1-2 is true ? 1. When people buy land, their purchases are included in GDP. 2. Used car dealerships add nothing to GDP because the cars they sell were already recorded in GDP when they were new. 3. Each of 1 and 2 is true. 4. Neither 1 nor 2 is true. [5]The inflation rate 1. explains how prices are reacting to economic policies 2. indicates the level of output of all firms in the economy 3. measures the annual percent increase in the average level of prices 4. measures how fast wages and incomes are rising h 5. None of the above. [6]The phase of the business cycle characterized by rising output is called a(n) 1. peak 2. recession 3. depression 4. trough 5. expansion
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2 [7]Which of 1-4 would be classified as consumption spending? 1. a family's purchase of a new home 2. a family's purchase of a used car 3. a family's payment for a child's hospitalization 4. a family's purchase of Microsoft stock 5. None of the above represents consumption spending. [8]Private investment during a year includes 1. the value of inventories plus the values of stocks and bonds 2. spending on plant and equipment, new housing construction, and changes in inventories 3. stocks and bonds purchased by firms 4. spending on plant and equipment plus government spending plus household spending on stocks and bonds 5. spending on plant and equipment plus capital formation [9]In the loans market the interest rate is below its equilibrium level. Given this fact which of 1-2 is true? 1. There is a positive excess demand for loans.
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EX1-KEY - Economics 2006, Spring 2008, Exam 1 [1]Which of...

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