Unit 2: Economic Indicators and Business Cycle

Which of the following is included in U.S. GDP? I. The market value of movies made in Africa by U.S. citizens II. The market value of olive oil made in Italy and sold in the United States III. The market value of blue jeans made in the United States and sold in Japan IV. The market value of wine made in the United States by Canadian citizens

What happened to Robin's nominal and real income?

A dark room technician who develops film into photographs loses her job because few people use film cameras anymore. This is an example of

The natural rate of unemployment

The GDP deflator differs from the CPI in that the GDP deflator

Among those hurt by unexpected inflation are I. borrowers at fixed interest rates II. individuals on fixed incomes III. those with savings earning fixed interest rates IV. restaurant owners

Which group of people will suffer the most from a rising price level?

If nominal GDP is $10 trillion and the GDP deflator is 125, real GDP is approximately

The domestic purchasing power of a currency

Which of the following transactions would be counted as part of GDP?

An economy has a labor force of 200 million, 8 million are frictionally unemployed, 4 million are structurally unemployed, and 6 million are cyclically unemployed. The unemployment rate and natural rate of unemployment are, respectively,

Which phase of the business cycle is characterized by declining real GDP, rising unemployment, and falling price levels?

The Consumer Price Index (CPI) tends to overstate the true inflation rate for all of the following reasons EXCEPT

Based on this data, what is the inflation rate from Year 1 to Year 2?

A college graduate who is looking for her first job would be classified as

If nominal GDP increased by 6 percent and the GDP deflator increased from 120 to 126, real GDP approximately

Which of the following is NOT counted as unemployed according to the Bureau of Labor Statistics?

Which of the following would cause the labor force participation rate to decline?

Transfer payments are NOT included in GDP because they

Net Domestic Product (NDP) equals GDP minus

Which of the following is an example of an economic leading indicator?

Gross National Product (GNP) differs from GDP in that GNP

Okun's law describes the relationship between

If the CPI increases from 200 to 210, the rate of inflation for that period is

Which of the following is NOT included in GDP as calculated by the expenditure approach?

If real GDP is [math]10 trillion, the GDP deflator is

Depreciation (capital consumption) is subtracted from GDP to obtain

A person who has given up looking for work after a prolonged job search is classified as

The income approach to measuring GDP adds up

Which of the following is NOT included in GDP?

The expenditure approach to calculating GDP sums

What is the nominal GDP for this economy?

Real GDP differs from nominal GDP because real GDP

The GDP deflator is calculated as

Frictional unemployment is best described as

Structural unemployment occurs when

The natural rate of unemployment includes

What is the inflation rate from Year 1 to Year 2?

The four phases of the business cycle, in order, are

Inflation hurts

The labor force participation rate measures the

What is the unemployment rate?

Nominal interest rate equals

A leading economic indicator is one that

The GDP deflator differs from the CPI because the GDP deflator

Discouraged workers are people who

GNP differs from GDP in that GNP

Full employment means that

Cost-push inflation is caused by

In Year 1, a country produces only cars and computers. In Year 1, it produces 10 cars at [math]1,000 each. In Year 2, it produces 12 cars at [math]1,200 each. Using Year 1 as the base year, what is real GDP in Year 2?