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Exam 1 Key - Economics 2006 Spring 2009 Exam 1 KEY[1]Which...

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Economics 2006, Spring 2009, Exam 1 KEY [1]Which of the following will not increase the average standard of living (per capita output)? 1. An increase in the EPR. 2. An increase in average hours worked. 3. An improvements in technology 4. An increase in population. 5. None of the above, each will increase the average standard of living. [2]If the unemployment rate is 8 percent, that means that 8 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]Over the past 75 years, the inflation rate has 1. generally increased 2. been positive in most years 3. stayed low 4. been negative in most years 5. dramatically increased [4]In 2003, the Ace Card Company produced $10 million worth of playing cards. Because of strong consumer demand for their product in 2003, Ace sold $12 million worth of cards, reducing their inventories by $2 million. How much value did Ace add to GDP in 2003? 1. $2 million 2. $8 million 3. $10 million 4. $12 million 5. $14 million [5]The phase of the business cycle characterized by falling output is called a(n) 1. peak 2. recession 3. depression 4. trough 5. expansion
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