ECON 201 Test #2 UPDATED ACTUAL
Questions and CORRECT Answers
Three of the major concerns of macroeconomics are... - CORRECT ANSWER - economic
growth, unemployment, and inflation
As depicted in the circular flow diagram, firms... - CORRECT ANSWER - supply the
goods and services that households demand in product markets.
GDP is the... - CORRECT ANSWER - total market value of all final goods and services
produced within a given period by factors of production located within a country.
Which of the following is not counted in the GNP of the United States? - CORRECT
ANSWER - The profit earned by a restaurant located in the United States but owned by a
Mexican company.
A firm's value added can be measured as the value of its... - CORRECT ANSWER - total
sales, less purchases from other firms.
A farmer sells grain to the miller, who in turn sells flour to the bakery. The bakery makes the
bread and delivers it to the grocery who finally sells it to the consumer. In calculating GDP we
would count... - CORRECT ANSWER - only the bread
Peanut butter, jelly beans, watermelon, canned soup and cheese are considered to be __________
goods. - CORRECT ANSWER - nondurable
Going to the dentist would be counted in GDP as... - CORRECT ANSWER - a service
Investment consists of... - CORRECT ANSWER - residential and non-residential
construction, and changes in inventories.
, A nation's net exports consist of... - CORRECT ANSWER - its exports minus its imports.
A trade deficit occurs when... - CORRECT ANSWER - we buy more from other countries
than we sell to them.
The GDP equation is... - CORRECT ANSWER - Y = C + I + G + NX
Y = GDP
C = Consumption
I = Investment
G = Government Purchases
NX = Net Exports
When GDP is measured in current prices it is known as the... - CORRECT ANSWER -
real GDP
Depreciation is... - CORRECT ANSWER - the estimated amount of physical capital that is
worn out or used up producing goods during the period.
The fraction of the working-age population that is in the labor force is called the... - CORRECT
ANSWER - labor force participation rate.
The unemployment rate is the number of unemployed people... - CORRECT ANSWER -
divided by the total working-age population.
Individuals who have stopped looking for work after an active search because of the lack of
transportation or lack of affordable child care, etc. are classified as ___________ workers. -
CORRECT ANSWER - marginally attached.
Questions and CORRECT Answers
Three of the major concerns of macroeconomics are... - CORRECT ANSWER - economic
growth, unemployment, and inflation
As depicted in the circular flow diagram, firms... - CORRECT ANSWER - supply the
goods and services that households demand in product markets.
GDP is the... - CORRECT ANSWER - total market value of all final goods and services
produced within a given period by factors of production located within a country.
Which of the following is not counted in the GNP of the United States? - CORRECT
ANSWER - The profit earned by a restaurant located in the United States but owned by a
Mexican company.
A firm's value added can be measured as the value of its... - CORRECT ANSWER - total
sales, less purchases from other firms.
A farmer sells grain to the miller, who in turn sells flour to the bakery. The bakery makes the
bread and delivers it to the grocery who finally sells it to the consumer. In calculating GDP we
would count... - CORRECT ANSWER - only the bread
Peanut butter, jelly beans, watermelon, canned soup and cheese are considered to be __________
goods. - CORRECT ANSWER - nondurable
Going to the dentist would be counted in GDP as... - CORRECT ANSWER - a service
Investment consists of... - CORRECT ANSWER - residential and non-residential
construction, and changes in inventories.
, A nation's net exports consist of... - CORRECT ANSWER - its exports minus its imports.
A trade deficit occurs when... - CORRECT ANSWER - we buy more from other countries
than we sell to them.
The GDP equation is... - CORRECT ANSWER - Y = C + I + G + NX
Y = GDP
C = Consumption
I = Investment
G = Government Purchases
NX = Net Exports
When GDP is measured in current prices it is known as the... - CORRECT ANSWER -
real GDP
Depreciation is... - CORRECT ANSWER - the estimated amount of physical capital that is
worn out or used up producing goods during the period.
The fraction of the working-age population that is in the labor force is called the... - CORRECT
ANSWER - labor force participation rate.
The unemployment rate is the number of unemployed people... - CORRECT ANSWER -
divided by the total working-age population.
Individuals who have stopped looking for work after an active search because of the lack of
transportation or lack of affordable child care, etc. are classified as ___________ workers. -
CORRECT ANSWER - marginally attached.
