ECON 103 FINAL EXAM QUESTIONS AND ANSWERS|
UPDATED RATED A+ | NEW
PART OF ELI WARREN ECONOMIC PLATFORM IS A WEALTH TAX ON A FAMILYS WEALTH ABOVE
50 MILLION. ASSUME THE ADDITIONAL TAX REVENUES WILL BE USED TO FUND WELFARE
PROGRAMS FOR THE POOR. IF THE IMPLEMTED THIS POLICY:
A. Will likely increase both effficiency and equality
b. Will likely increase efficiency at the cost of equality
c. Will likely increase equality at the cost of efficiency
d. Will likely decrease both efficiency and equality
RECALL THE CIRCULAR FLOW DIAGRAM MODEL OF THE ECONOMY. WHICH OF TH EFOLLOWING
STATEMENTS IS TRUE IN TH EMODEL?
A. Households purchase goods such as cars in the markets for goods and services
b. Gov't hires labor and rent in the markets for factors of produc7on
c. Households sell labor and rent capital in the markets for goods and services
d. Foreign firms earn revenue from the sale of goods in the markets for goods and services.
IN 2017 U.S. GDP WAS 19.5 TRILLIO. CONSUMPTION EXPENDITURES WERE 13.3, INVESTMENT
WAS 3.4 TRILLION, IMPORTS WERE 2.9 TRILLION, AND EXPORTS WERE 2.3 TRILLION. USE THE
NATIONAL INCOME IDENTITY TO FIND GOV'T EXPENDITURES FOR 2017
a. 2.2 trillion
b. 2.8 trillion
c. 3.1 trillion
d. 3.4 trillion
T/R MOST ECONOMISTS BELIEVE THE CPI UNDERESTIMATES THE RISE IN TH ECOST OF LIVING
DUE TO SUBSTITUTION EFFECTS, INTRODUCTION TO NEW GOODS AND UNMEASURED QUALITY
CHANGE
TRUE
1000 PPL LIVE IN UTILIT. OF THOSE NOT WORKING: 100 ARE COLLEGE STUDENTS, 200 ARE
RETIRED SENIORS, 50 ARE ACTIVELY LOOKING FOR A JOB, 25 WANT A JOB BUT HAVE NOT MADE
ANY EFFORT TO GET ONE IN THE LAST MONTH, 25 DO HOUSEWORK AND DO NOT WANT A JOB.
OF THE 600 EMPLOYED: 400 ARE WORKING FULL TIME, 100 ARE WORKING PT, AND 100 ARE
WORKIN PT BUT ARE LOOKING FOR FT. THE LABOR FORCE PARTICIPATION RATE IS
, a. 60%
b. 65%
c. 70%
d. 80%
FOR THE ECONOMY DESCRIBED IN THE PRECEDING QUESTION THE UNEMPLOYMENT RATE IS
APPROXIMATELY ?
a. 7.4%
b. 7.7%
c. 11.5%
d. 23.1%
T/F IN THE U.S. WOMEN HAVE LOWER LABOR FORCE PARTICIPATION RATES THAN MEN, BUT
SIMILAR UNEMPLOYMENT RATES
TRUE
T/F FIRMS MAY PAY EFFICIENCY WAGES TO WORKERS TO REDUCE WORKER TURNOVER. WE
SHOULD EXPECT THIS POLICY WILL INCREASE FRICTIONAL UNEMPLOYMENT BUT WILL NOT
AFFECT STRUCTURAL UNEMPLOYMENT
FALSE
WHICH OF THE FOLLOWING STATEMETNS IS FALSE?
A. In the US, GDP per capita has been growing at the approximately 2% per year over the past
century
C. The US laboer force has become increasingly more educated over the past century
D. Sustained economic growth has only occured in the pst few centuries
B. In the past half century, economic outcomes have converged, the poorest countries hav
egrown the fastest and the richest countries have grown the slowest
WHICH OF THE FOLLOWING POLICIES IS MOST LIKELY TO INCREASE THE GROWTH RATE OF
COUNTRY?
A. An increase in the cap7al income tax that reduces the savings rate
B. An introdutcion of new laws that bans foreign direct investment
C. A reduc7on in tariffs that promotes free trade
D. abolising patent laws; new inven7ons/technology can be freely reproduced anyone
UPDATED RATED A+ | NEW
PART OF ELI WARREN ECONOMIC PLATFORM IS A WEALTH TAX ON A FAMILYS WEALTH ABOVE
50 MILLION. ASSUME THE ADDITIONAL TAX REVENUES WILL BE USED TO FUND WELFARE
PROGRAMS FOR THE POOR. IF THE IMPLEMTED THIS POLICY:
A. Will likely increase both effficiency and equality
b. Will likely increase efficiency at the cost of equality
c. Will likely increase equality at the cost of efficiency
d. Will likely decrease both efficiency and equality
RECALL THE CIRCULAR FLOW DIAGRAM MODEL OF THE ECONOMY. WHICH OF TH EFOLLOWING
STATEMENTS IS TRUE IN TH EMODEL?
A. Households purchase goods such as cars in the markets for goods and services
b. Gov't hires labor and rent in the markets for factors of produc7on
c. Households sell labor and rent capital in the markets for goods and services
d. Foreign firms earn revenue from the sale of goods in the markets for goods and services.
IN 2017 U.S. GDP WAS 19.5 TRILLIO. CONSUMPTION EXPENDITURES WERE 13.3, INVESTMENT
WAS 3.4 TRILLION, IMPORTS WERE 2.9 TRILLION, AND EXPORTS WERE 2.3 TRILLION. USE THE
NATIONAL INCOME IDENTITY TO FIND GOV'T EXPENDITURES FOR 2017
a. 2.2 trillion
b. 2.8 trillion
c. 3.1 trillion
d. 3.4 trillion
T/R MOST ECONOMISTS BELIEVE THE CPI UNDERESTIMATES THE RISE IN TH ECOST OF LIVING
DUE TO SUBSTITUTION EFFECTS, INTRODUCTION TO NEW GOODS AND UNMEASURED QUALITY
CHANGE
TRUE
1000 PPL LIVE IN UTILIT. OF THOSE NOT WORKING: 100 ARE COLLEGE STUDENTS, 200 ARE
RETIRED SENIORS, 50 ARE ACTIVELY LOOKING FOR A JOB, 25 WANT A JOB BUT HAVE NOT MADE
ANY EFFORT TO GET ONE IN THE LAST MONTH, 25 DO HOUSEWORK AND DO NOT WANT A JOB.
OF THE 600 EMPLOYED: 400 ARE WORKING FULL TIME, 100 ARE WORKING PT, AND 100 ARE
WORKIN PT BUT ARE LOOKING FOR FT. THE LABOR FORCE PARTICIPATION RATE IS
, a. 60%
b. 65%
c. 70%
d. 80%
FOR THE ECONOMY DESCRIBED IN THE PRECEDING QUESTION THE UNEMPLOYMENT RATE IS
APPROXIMATELY ?
a. 7.4%
b. 7.7%
c. 11.5%
d. 23.1%
T/F IN THE U.S. WOMEN HAVE LOWER LABOR FORCE PARTICIPATION RATES THAN MEN, BUT
SIMILAR UNEMPLOYMENT RATES
TRUE
T/F FIRMS MAY PAY EFFICIENCY WAGES TO WORKERS TO REDUCE WORKER TURNOVER. WE
SHOULD EXPECT THIS POLICY WILL INCREASE FRICTIONAL UNEMPLOYMENT BUT WILL NOT
AFFECT STRUCTURAL UNEMPLOYMENT
FALSE
WHICH OF THE FOLLOWING STATEMETNS IS FALSE?
A. In the US, GDP per capita has been growing at the approximately 2% per year over the past
century
C. The US laboer force has become increasingly more educated over the past century
D. Sustained economic growth has only occured in the pst few centuries
B. In the past half century, economic outcomes have converged, the poorest countries hav
egrown the fastest and the richest countries have grown the slowest
WHICH OF THE FOLLOWING POLICIES IS MOST LIKELY TO INCREASE THE GROWTH RATE OF
COUNTRY?
A. An increase in the cap7al income tax that reduces the savings rate
B. An introdutcion of new laws that bans foreign direct investment
C. A reduc7on in tariffs that promotes free trade
D. abolising patent laws; new inven7ons/technology can be freely reproduced anyone
