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26 Cards in this Set
- Front
- Back
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Which of the following is not one of the macroeconomic goals?
a. Economic Justice b. Full employment c. Stable Prices d. Sustained Economic Growth e. None of the above |
a. Economic Justice
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Suppose you are a neurosurgeon in a private practice who on average earns $250 per hour. A typical week consists of 30 billable hours. You decide to spend four weeks in Zambia working in a medical clinic run by your church. You receive no pay and pay your own expenses. The round trip ticket costs $3,000 while your food and board costs $1,000.
The implicit cost of your trip is.. a. 4,000 b. 30,000 c.34,000 d. 26,000 |
b. 30,000
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Suppose you are a neurosurgeon in a private practice who on average earns $250 per hour. A typical week consists of 30 billable hours. You decide to spend four weeks in Zambia working in a medical clinic run by your church. You receive no pay and pay your own expenses. The round trip ticket costs $3,000 while your food and board costs $1,000.
The explicit cost of your trip is... a.4,000 b. 30,000 c. 34,000 d. 26,000 |
a. 4,000
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Suppose you are a neurosurgeon in a private practice who on average earns $250 per hour. A typical week consists of 30 billable hours. You decide to spend four weeks in Zambia working in a medical clinic run by your church. You receive no pay and pay your own expenses. The round trip ticket costs $3,000 while your food and board costs $1,000.
The total opportunity cost of your trip is... a. 4,000 b.30,000 c. 34,000 d. 26,000 |
c. 34,000
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Suppose you are a neurosurgeon in a private practice who on average earns $250 per hour. A typical week consists of 30 billable hours. You decide to spend four weeks in Zambia working in a medical clinic run by your church. You receive no pay and pay your own expenses. The round trip ticket costs $3,000 while your food and board costs $1,000.
what is the total economic cost of your trip? a. 4,000 b. 30,000 c. 34,000 d. 26,000 |
c. 34,000
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Which of the following represents the "expenditure method" of calculating GDP?
a. Y=C+I+G+NX b. Y=Wages+Profits+Interest+Rents c. Y=P1Q1 +P2Q2+P3Q3....where P1 and P2 are market prices and Q1 and Q2 are the quantities of final goods and services d. None of the above |
a. Y=C+I+G+NX
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The difference between nominal and real values is...
a. nominal values are adjusted for inflation and real values are not . b. real values are calculate using current prices and nominal values are calculated using constant "base year" prices c. Real values are adjusted for inflation and nominal values are not. D. real values are calculated using constant "base year" prices and nominal values are calculated using current prices e. C and D |
e. C and D
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The problem introduced by the method of aggregate using nominal GDP to measure the output of the economy is...
a. Inflation will cause the output of the economy to overstated b. Inflation will cause the output of the economy to understated c. Nominal GDP included intermediate goods and services d. Leisure is not included in the measure |
a. Inflation will cause the output of the economy to be overstated
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the substitution bias in calculating the CPI, results in inflation...
a. Being overestimated b. Being underestimated c. accelerating to a higher rate of growth d. being lower than it would otherwise be |
a. being overestimated
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An additional employer will be hired as long as the VMPl of the employee is greater than the market wage is called...
a. hiring rule b.Fisher effect c. the real wage rule d. the labor force rule |
a. The hiring rule
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Which of the following does not shift the demand curve for labor to the right
a. an increase in the demand for goods that labor produces b. an increase in the price of goods that labor produces c. technical change d. adding fixed capital e. an increase in the working age population |
E. an increase in the working age population
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Which of the following does not shift the supply curve of labor to the right..
a. an increase in the labor force participation rate b. high rate of immigration c. technical change d. an increase in the working age population |
c. technical change
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One of the reasons that the Soviet Union failed is...
a. there was a lack of human capital b. resources were too scarce c. the people did not have property rights d. lack of economic central planning |
c. the people did not have property rights
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What are the three macroeconomic goals?
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1. Full Employment
2.Stable Prices 3. Sustained Economic Growth |
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Define Inflation
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A continuing increase in the average price level
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What is meant by indexation?
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it is used to adjust income payment by means of a price index
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Define VMP_L (value of the margial product of labor?
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So the Value of MP_L is the additional revenue from hiring one more employee
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Given the following actual data for the U.S.
2007- 14,061.8 # of emp-146,033 2010- 14,660.2 # of emp-139,206 |
For 2007 do Nominal GDP/ Number employed
14,061.8/ 146,033 = $ 96,292 For 2010 14,550.2/ 139,206= $105,313 |
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Calculate real GDP in 2007 and 2010 using 2007 as a base year
Nominal GDP 2007- 14,061.8 2010- 14,660.2 GDP deflator 2007-106.3 2010-110.7 |
2007=
14,061.8 X 106.4/106.3= 14,061.8 2010= 14,660.2 X 106.3/ 110.7 = $14,077.5 |
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Calculate the average annual growth rate of per capital real GDP between 2007 and 2010
use real GDP from above question 2007=14,061.8 2010=14,077.8 Population 2007= 304.4 2010= 312.1 |
2007= 14,061.8/304.4= 46,195
2010= 14,077.8/ 312.1= 45,106 sooo growth is 45,106-46,195/ 46,195 X 100 = -.79% |
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In 1962 I paid $10 for a white orchid corsage for my date to the Junior Prom. What is the price of the corsage in 2010 prices?
GDP in 1962= 30.2 GDP in 2010=218.2 |
10 X 218.2/ 30.2 = $72.21
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Bob's Salary in Dallas is $60,000 per year. He has been offered a job in Chicago that pay $65,000 per year. How much of the real increase in income (if any) does he gain if he takes the offer.
Chicago= 215.2 Dallas= 203.2 |
65,000 X 203.2/ 215.2 = 61,375
so 60,000-61,375. He is really only getting an increase in $1,375 |
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Doing the graph what would be the monthly wage rate have to be to justify employing 4 employees?
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Less than $400,000
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Doing the graph what would be the monthly wage rate have to be to justify employing 6 employees?
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Any way less than zero
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IN 2010 Indian's per capita GDP was estimated to be $3,400. The estimated growth in real GDP was 8.3%. The growth rate of the population was about 1.4%. This means that the growth rate of real GDP per capita was about 6.9%. At these rates how many years will it take for the following to double?
Real GDP Population real GDP per capita |
Real GDP= 70/8.3 = 8.43 years
Population= 70/ 1.4= 50 years Real GDP per capita- 70/6.9= 10.14 years |
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List the Six growth factors with one sentence.
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a. Increase in Physical Capital
-buildings, equipment. b. Increase in Human capital -education skills and ability of people c. Entrepreneurship and Managerial skills -New ideas, new and efficient ways d. technological advances -technology effects growth e. Improved Legal and Political -new laws, low taxes and minimum regulation f. Increasing availability of natural resources |
