Sample questions for midterm

Last year was the base year this year inflation was 5

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Last year was the base year, this year inflation was 5%. What is this year's GDP deflator? 1.05 .95 105 95 Real GDP will decrease only when production of goods and services and prices decrease. only when prices decrease. when prices decrease or output decreases. only when production of goods and services decreases. Real GDP is adjusted for differences in the quality of the environment but not for differences in leisure time adjusted for differences in leisure time and differences in the quality of the environment. not adjusted for differences in leisure time, nor adjusted for the differences in the quality of the environment adjusted for differences in leisure time, but not for differences in the quality of the environment
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If the nominal interest rate is 2 percent and the real interest rate is 4 percent, then the inflation rate is -2 percent. 2 percent. 6 percent. 0 percent. Which of the following defines productivity? The quantity of labor required to produce a nation's GDP. The quantity of labor required to produce one unit of goods and services. The quantity of goods and services produced from each unit of labor input. The quantity of goods and services produced per unit of time Last year, a toy factory made 60,000 toys employing 80 workers, each of whom worked 8 hours per day. This year, the factory produced 76,500 toys, employing 85 workers, each of whom worked 10 hours per day. What can you say about factory's productivity? Productivity remained the same. Productivity decreased by 4%. Productivity increased by increased by 8.33%. Productivity increased by 4%. Suppose a European firm opens a new toy factory in China. This is an example of brain-drain. foreign direct investment. indirect foreign investment. foreign portfolio investment. According to the theory of efficiency wages, if a firm stops paying efficiency wages it is likely to see a(n) decrease in the quality of job applicants but need to replace workers less frequently. decrease in the quality of job applicants and need to replace workers more frequently. increase in the quality of job applicants and need to replace workers less frequently. increase in the quality of job applicants but need to replace workers more frequently.
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The financial system moves the economy's scarce resources from
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