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Exam_I_-_Spring_2011_-__PINK

# Exam_I_-_Spring_2011_-__PINK - Butter Butter YX W Z Guns...

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Butter Guns Butter Guns Z W X Y The nation of Fruitania produces only Apples, Oranges and Pears. Production levels and prices for the years 2009 and 2010 are shown in the table below: Quanti ties Produ ced Prices Per Unit Q Apple Q Orang e Q Pear P Apple P Orange P Pear 2009 100 75 80 1.90 1.50 1.75 2010 105 65 80 2.20 1.60 1.80 The base year for all calculations below regarding Fruitania is 2009. 1. GDP in Fruitania in 2009 equals: a) 426.50 b) 437.00 * c) 442.50 d) 479.00 2. Real GDP in 2010 in Fruitania equals: 3. The GDP Deflator in Fruitania for 2009 equals: * 4. Between 2009 and 2010 GDP grew by ______ percent as the GDP Deflator grew by ______ percent. 5. Leslie is offered a job in Seattle that pays \$50,000. She is also offered a job in Boston that pays \$60,000. Which set of CPIs below would make the two salaries have almost the same purchasing power? a) 100 in Seattle and 124.5 in Boston * c) 83.3 in Seattle and 100 in Boston b) 100 in Seattle and 140 in Boston d) 89.3 in Seattle and 100 in Boston 6. The shift inward of the production possibilities frontier shown here could have been caused by: *a) the economy entering a recession, with falling production and rising unemployment. *b) a decrease in the rate of inflation. c) improved technology in production. *d) None of the above.

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