ECO 201 – EXAM EXAM QUESTIONS WITH CORRECT VERIFIED ANSWERS | 100% PASS (A+ CERTIFIED)

ECO 201 – EXAM EXAM QUESTIONS WITH CORRECT VERIFIED ANSWERS | 100% PASS (A+ CERTIFIED)_________ are now the largest single component of the supply side of GDP, representing over half of GDP. Durable goods Services Nondurable goods Structures Answer Services _________ is output per hour in the business sector. Net exports Productivity Investment GDP per capita Answer productivity __________ implies that pressure for price increases reaches across _______________markets, not just one. inflation; all deflation; most inflation; most deflation; all Answer inflation; most ___________ is a small category that refers to the goods produced by one business that have yet to be sold to consumers, and are either still sitting in warehouses and on store shelves. Inventories Services Structures Durable goods Answer Inventories ___________ is about two-thirds of the demand side of GDP, but it moves relatively little over time. Government Consumption Investment Services Answer Consumption _____________________ is a term which refers to the widespread use of power-driven machinery and the economic and social changes that resulted in the first half of the 1800s. GDP per capita The Industrial Revolution The living standard Investment and inventions Answer The Industrial Revolution ______________________ argues that the productivity of workers will increase if they are paid more, and so employers will often find it worthwhile to pay their employees somewhat more than market conditions might dictate. Efficiency wage theory Equilibrium wage theory Employee wage theory Employer wage theory Answer Efficiency wage theory _______________, which can be approximated by the growth of gross domestic product, ultimately determines the prevailing standard of living in a country. Trade balance Inflation Education Economic growth Answer Economic growth 5 categories of produces Answer durable goods, nondurable goods, services, structures, and the change in inventories A business cycle reflects changes in economic activity, particularly real GDP. The stages of a business cycle are: trough, expansion, recession, peak contraction, recession, expansion, boom expansion, trough, recession, peak expansion, peak, recession, trough Answer expansion, peak, recession, trough A country will roughly double its GDP in twenty years if its annual growth rate is: 12 percent. 7.5 percent. 3.5 percent. 2.5 percent. Answer 3.5 percent Use rule of 72 Formula years to double = 72/annual growth rate 20 = 72/annual growth rate 72/20 = 3.5% A depreciating U.S. dollar is ________________ because it is worth ___________ in terms of other currencies. strengthening; more weakening; less a problem for exporters; less beneficial to importers; more Answer weakening; less A forestry worker who is out of work because of the temporarily low demand for wood products associated with a recession is defined as: cyclically unemployed. underemployed. frictionally unemployed. naturally unemployed. Answer cyclically unemployed A lender demands an interest rate in part to compensate for any expected ___________, so that the money that is repaid in the future will have at least as much buying power as the money that was originally loaned. risk premium inflation compound interest opportunity costs Answer inflation A nation can achieve higher economic growth if: it devotes more resources to research and development. the productivity of labor declines taxes are imposed on investment in capital. more resources are allocated to consumption goods. Answer it devotes more resources to research and development. A nation's prosperity is sometimes measured in terms of ___________.