Pre-Test Chap 23 e18 - Pre-Test Chap 23 e18 Student: _ 1....

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Pre-Test Chap 23 e18 Student: ___________________________________________________________________________ 1. Short-run fluctuations in output and employment are referred to as A. business cycles B. economic growth C. inventory cycles D. recessions 2. Refer to the graph above. Which of the following best represents an increase in demand when prices are inflexible? A. The shift from D2 to D3 in graph B B. The shift from D2 to D3 in graph A C. The shift from D2 to D1 in graph B D. The shift from D2 to D1 in graph A 3. Suppose that real GDP increases by 5% while the population of a country increases by 7%. Then A. output per person necessarily increases B. output per person necessarily decreases C. output per person necessarily remains unchanged D. there is not enough information to determine what happens to output per person 4. In 2007, output per person in Japan was A. $45,845 B. $38,345 C. $33,576 D. $33,187 5. High rates of unemployment A. indicate that society is not using a large fraction of the talent and skills of its people B. are associated with higher price levels C. always correspond to a decrease in nominal GDP D. do not effect an economy's output of goods and services
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6. Which of the following statements is true? A. Financial investment refers to the creation and expansion of business enterprises B. Economic investment refers to the creation and expansion of business enterprises C. Economic investment refers to the purchase of assets such as stocks, bonds, and real estate D. Both economic investment and financial investment refer to the purchase of assets such as stocks, bonds, and real estate 7. If prices are sticky, then a negative demand shock will lead to A. a short-run increase in real GDP B. a short-run decrease in real GDP C. a long-run increase in real GDP D. a long-run decrease in real GDP 8. Refer to the graph above. Suppose a firm is currently producing 500 computers per week and charging a price of $1000. How will the firm respond to a positive demand shock if prices are flexible? A. The firm will increase production to 650 computers per week and charge a price of $1200 B. The firm will continue to produce 500 computers per week and charge a price of $1200 C. The firm will cut production to 300 computers per week and charge a price of $1000 D. The firm will cut production to 300 computers per week and charge a price of $600
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This note was uploaded on 05/23/2010 for the course ECON 101 taught by Professor Keep during the Spring '10 term at Glendale Community College.

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Pre-Test Chap 23 e18 - Pre-Test Chap 23 e18 Student: _ 1....

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