Macroeconomics Quiz # 4

The total value of all final goods and services produced in a given period, such as a year or a quarter, adjusted for inflation is real gross domestic product

True

False

A period of significant decline in output and employment is called

Reentrant

Recession

Reversible

None of these

An individual who worked before and is now reentering the labor force is called

Reentrant

Recession

Reversible

None of these

The price of a specific good compared to the price of other goods is called

Relative price

Fair price

Fractional price

All of these

The time and inconvenience cost incurred when individuals reduce their money holdings because of inflation is known as shoe leather cost

True

False

The unemployment that results from the persistent mismatch of the skills of workers and the requirements of jobs is ____ employment

Functional

Structural

Physical

All of these

____ is the point in time when output stops declining, that is, when business activity is at its lowest point in the cycle

Crest

Trough

Slope

All of these

Under employment is a situation in which a worker’s skill level is higher than necessary for a job

True

False

Unemployment is the percentage of the population age ____ and older who are willing and able to work but are unable to obtain a job

18

24

16

26

Purchases of final goods and services is called

Depreciation

Consumption

Expansion

Destruction

Annual allowance set aside to replace worn-out capital is called

Depreciation

Consumption

Expansion

Destruction

Disposable personal income is the personal income available after personal taxes

True

False

Adding the value of a good or service more than once by mistakenly counting the intermediate goods and services in GDP is ____ counting

Single

Double

Constant

Zero

Longer-lived consumer goods, such as automobiles are durable goods

True

False

The calculation of GDP by adding the expenditures of market participants on final goods and services over a given period is expenditure approach

True

False

Wages (salaries), rent, interest payments, and profits paid to the owners of productive resources are factor payments

True

False

All new spending on capital goods by producers is ___ investment

Fixed

Changed

Constant

All of these

Gross domestic product is measure of economic performance based on the value of all final goods and services produced within a country during a given period

True

False

Taxes, such as sales tax, levied on goods and services sold is ___ business taxes

Direct

Indirect

Main

All of these

Purchases that add to the stocks of goods kept by the firm to meet consumer demand is ____ investment

Good

Inventory

Profit

Loss

The creation of capital goods to augment future production is called

Deposits

Investment

Income

Transaction

____ income is measure of income earned by owners of the factors of production

National

Rational

Fractional

Profit

A uniform means of measuring economic performance is national income accounting

True

False

Net national product is GNP ___ depreciation

Plus

Minus

Multiply

Subtract

____ items consumed in a short period of time, such as food

Are nondurable goods

Intangible

Tangible

Proper

Essential

The amount of income received by households before personal taxes is called

Main income

Personal income

Good income

All of these

Capital goods that increase future production capabilities are producer goods.

True

False

Real output of goods and services per person is real gross domestic product per capita

True

False

Applications of new knowledge that create new products or improve existing products is called

Innovation

Productivity

Ideas

All of these

___ per unit of worker is labour productivity

Input

Output

Person

Work