Assuming the economy was in equilibrium, use the following information to calculate
the total value of leakages.
Total leakages are
a. $2.5 trillion
b. $2.7 trillion
c. $3.0 trillion
d. $5.2 trillion
e. $5.7 trillion
Which of the following describes the relationship between the change in inventories
and aggregate expenditure?
a. Aggregate expenditure equals the change in inventories minus GDP.
b. The change in inventories equals GDP divided by aggregate expenditures.
c. Aggregate expenditures equals GDP divided by the change in inventories.
d. Aggregate expenditures equals GDP minus the change in inventories.
e. The change in inventories equals GDP multiplied by aggregate expenditure.
At what U.S. unemployment rate do most economists believe full employment occurs?
a. 0 percent
b. between 1.5 and 2.0 percent
c. between 4.5 and 5.0 percent
d. between 5.5 and 6.0 percent
e. between 7.5 and 8.0 percent
The sale of which of the following would appear without any modification in GDP?
a. Used automobiles
b. Iron ore mined from the ground
c. Maid services
d. Aluminum rods used in construction
e. Wood pulp
If net taxes decrease, which of the following would occur?
a. Disposable income decreases, consumption at any income level increases, and the
consumption-income line shifts upward.
b. Disposable income increases, consumption at any income level increases, and the
consumption-income line shifts downward.
c. Disposable income increases, consumption at any income level increases, and the
consumption-income line shifts upward.
d. Disposable income decreases, consumption at any income level decreases, and the
consumption-income line shifts downward.
e. Disposable income increases, consumption at any income level decreases, and the
consumption-income line shifts downward.
Which of the following is a flow variable?
a. the number of cars registered in the U.S.
b. the number of unemployed workers this week
c. your total net worth yesterday
d. the government debt this year
e. a salary of $4,000 per month
Given the balance sheet below and assuming a required reserve ratio of 20 percent, how
much (in dollar terms) must the bank hold in required reserves?
a. It is failing to meet its reserve requirement.
b. It is just meeting its reserve requirement, but has no excess reserves.
c. It is meeting its reserve requirement, and has $5 million in excess reserves.
d. It is meeting its reserve requirement, and has $10 million in excess reserves.
e. It is meeting its reserve requirement, and has $15 million in excess reserves.
A family on a trip budgets $800 for restaurant meals and fast food. The family can buy
16 restaurant meals if they don’t buy any fast food. What is the price of a fast-food meal
for the family?
An increase in human capital would lead to
a. a decrease in the standard of living
b. an upward shift of the production function
c. a decrease in productivity
d. cutbacks in government skill-training programs
e. a decrease of the capital stock
A financial intermediary less strictly regulated than a bank, and with no government
guaranteed deposits is known as a
a. non-bank.
b. junior bank.
c. secondary bank.
d. trade bank.
e. intermediary bank.
Which of the following is included in GDP?
a. The imputed rental value of a family-owned home
b. The sale prices of all previously built homes
c. Social security payments to retirees
d. The salary of a U.S. scientist working in a foreign country
e. Purchases of stocks and bonds
In the short run, costs that arise from resources that cannot vary in quantity are known
as ____________, whereas costs from inputs that can vary in quantity are known as
____________.
If the Fed conducts open market purchases, we should expect to see the money supply
a. decrease, the interest rate increase, autonomous consumption decrease, business
investment decrease, and real GDP decrease
b. increase, the interest rate decrease, autonomous consumption decrease, business
investment decrease, and real GDP decrease
c. increase, the interest rate decrease, autonomous consumption increase, business
investment increase, and real GDP increase
d. decrease, the interest rate decrease, autonomous consumption increase, business
investment increase, and real GDP decrease
e. decrease, the interest rate increase, autonomous consumption increase, business
investment increase, and real GDP increase
Under conditions of perfect competition, if any one buyer increases her purchases, the
market price
If British tastes changed so that Britons began to desire more American goods, there
would be
a. a rightward movement along the supply of British pounds curve in the dollar-pound
market
b. a leftward movement along the supply of British pounds curve in the dollar-pound
market
c. a rightward shift of the supply of British pounds curve in the dollar-pound market
d. a leftward shift of the supply of British pounds curve in the dollar-pound market
e. no change in the supply of British pounds curve in the dollar-pound market
The decline in output at the onset of the Great Depression was caused primarily by
a. a positive demand shock
b. a negative demand shock
c. a positive supply shock
d. a negative supply shock
e. simultaneous shocks to supply and demand
Using the following information on a hypothetical economy in equilibrium, calculate
total output for 2008.
If exports are exactly equal to imports, total output for 2008 is
a. $5.2 trillion
b. $5.7 trillion
c. $8.4 trillion
d. $8.7 trillion
e. $13.9 trillion