EC 102, Sections AA and BB, Fall 2010 Practice Final

EC 102 Sections AA - Econ 102 Introductory Macroeconomic Analysis Fall 2010 Practice Final 1 Which of the following examples of production of goods

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Econ 102 Introductory Macroeconomic Analysis Fall, 2010 Practice Final ____ 1. Which of the following examples of production of goods and services would count as part of U.S. GDP? a. Samantha, a Canadian citizen, grows sweet corn in Minnesota and sells it to a grocery store in Canada. b. Ian, an American citizen, grows peaches for his family in the back yard of their Atlanta home. c. Brian, an American citizen, grows marijuana in Mexico and sells it in Europe d. None of the above examples of production would count as part of U.S. GDP. ____ 2. If a small country has current nominal GDP of $25 billion and the GDP deflator is 125, what is real GDP? a. $312.5 billion b. $207.5 billion c. $31.25 billion d. None of the above is correct. ____ 3. The economy's inflation rate is the a. price level in the current period. b. change in the price level from the previous period. c. change in the gross domestic product from the previous period. d. percentage change in the price level from the previous period. ____ 4. In the CPI, goods and services are weighted according to a. how long a market has existed for each good or service. b. the extent to which each good or service is regarded by the government as a necessity. c. how much consumers buy of each good or service. d. the number of firms that produce and sell each good or service. Table 24-1 year Peaches Pecans 2005 $11 per bushel $6 per bushel 2006 $9 per bushel $10 per bushel ____ 5. Refer to Table 24-1 . Suppose the typical consumer basket consists of 10 bushels of peaches and 15 bushels of pecans. Using 2005 as the base year, the CPI for 2006 is a. 100. b. 120. c. 200. d. 240.
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____ 6. Assume an economy experienced a higher inflation rate, as measured by the CPI, between 2004 and 2005 than it experienced between 2003 and 2004. Which of the following scenarios is consistent with this assumption? a. The CPI was 100 in 2003, 110 in 2004, and 120 in 2005. b. The CPI was 100 in 2003, 110 in 2004, and 124 in 2005. c. The CPI was 110 in 2003, 150 in 2004, and 200 in 2005. d. All of the above are correct. ____ 7. Babe Ruth's 1931 salary was $80,000. Government statistics show a consumer price index of 15.2 for 1931 and 195 for 2005. Ruth's 1931 salary was equivalent to a 2005 salary of about a. $536,000. b. $828,000. c. $1,026,000. d. $1,216,000. ____ 8. During the past century the average growth rate of U.S. real GDP per person was about 2%. This implies that it doubled about every a. 100 years on average. b. 70 years. c. 35 years. d. 25 years. ____ 9. The level of real GDP per person a. differs widely across countries, but the growth rate of real GDP per person is similar across countries. b. is very similar across countries, but the growth rate of real GDP per person differs widely across countries.
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This note was uploaded on 04/26/2011 for the course ECON 102 taught by Professor Soffriti during the Spring '08 term at BU.

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EC 102 Sections AA - Econ 102 Introductory Macroeconomic Analysis Fall 2010 Practice Final 1 Which of the following examples of production of goods

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