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Exam 17: Measuring Economic Activity: GDP and Unemployment

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Question 1

Multiple Choice

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Capital income in the U.S. equals approximately ________ of GDP.

A) 10 percent
B) 25 percent
C) 50 percent
D) 75 percent

E) B) and D)
F) All of the above

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B

Question 2

Multiple Choice

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An economy produces 500,000 tables valued at $100 each. Households purchase 100,000 tables, of which 50,000 are imported. Businesses purchase 200,000 domestically produced tables, the government purchases 100,000 domestically produced tables, and 50,000 domestically produced tables are sold abroad. At the end of the year, the table manufacturers hold the unsold tables in inventory. What is value of the investment component of GDP?

A) $10 billion
B) $20 million
C) $25 million
D) $30 million

E) A) and B)
F) A) and C)

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Question 3

Multiple Choice

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Bob's Barber Shop cut 3,000 heads of hair in 2016 and 3,100 in 2017. The price of a haircut was $7 in 2016 and $8 in 2017. If 2016 is the base year, what was Bob's contribution to nominal GDP in 2017?

Which of the following is an example of an intermediate good?

In an economy of 100 people in the labor force, if 10 people are unemployed for 4 weeks during the year, and 30 people are unemployed for 8 weeks during the year, and the rest are employed continuously throughout the year, then the average duration of unemployment in this economy is:

People who would like to work full-time, but are able to find only part-time work are:

Real GDP measures the ________ of production; nominal GDP measures the ________ of production.

To compare the change in physical production (GDP) between 2012 and 2018, we should compare ________ GDP in 2012 with ________ GDP in 2018.

Who from among the following would be classified as out of the labor force?

Goods and services provided by state and local governments are:

Jim Brown would like to work, but has not looked for work in the past four weeks because he does not believe any jobs are available. In the official employment statistics, Jim is classified as:

Nominal GDP measures the ________ of production.

An economy produces only 500,000 tables valued at $100 each. Of these, 100,000 are sold to consumers, 200,000 are sold to businesses, 100,000 are sold to the government, and 50,000 are sold abroad. No tables are imported. At the end of the year, the table manufacturers hold the unsold tables in inventory. What is the value of the investment component of GDP?

Based on the information in the table, how big is the labor force?   $\begin{array} { | l | r } \hline \text { Population } 16 \text { and older } & 1,000,000 \\\hline \text { Participation Rate } & 80 \% \\\hline \text { Errployed Workers } & 720,000 \\\hline\end{array}$  

The unemployment rate equals the number of people:

An economy produces only 1,000,000 computers valued at $2,000 each. Of these, 200,000 are sold to consumers, 300,000 are sold to businesses, 300,000 are sold to the government, and 100,000 are sold abroad. No computers are imported. At the end of the year, the computer manufacturers hold the unsold computers in inventory. What is the value of GDP?

Real GDP is not a perfect measure of economic well-being because it excludes the value of all of the following except:

The value of unpaid childcare services provided by a stay-at-home dad ________ included in GDP; the value of daycare services purchased from a licensed childcare provider ________ included in GDP.

Which of the following transactions would be included in the GDP of the United States?

One way to avoid counting the prices of intermediate goods multiple times in computing the value of GDP is to: