- Which of the following best describes what happens in range 2?
A. The price level falls.
B. Unemployment increases.
C. Unemployment is irrelevant.
D. The price level rises.
E. Productive capacity declines. - What is the difference between cyclical unemployment and structural unemployment?
A. Cyclical happens during the contraction phase, and structural occurs because of a lack of skills.
B. Cyclical happens during the expansion phase, and structural pertains to those just graduating from college.
C. Cyclical happens during the peak phase, and structural describes discouraged workers.
D. Cyclical and structural occur in the contraction phase only.
E. None of the above. - Which one of the following is the formula for the expenditures approach?
A. C + T + X + Y
B. G + I + R + X
C. C + I + G + X
D. C + H + O +X
E. I + X +T + Y - What is the difference between real GDP and nominal GDP?
A. Real GDP measures total value of goods and services with adjustment for inflation, and nominal GDP is not
adjusted for inflation.
B. Real GDP measures unadjusted values of final goods and services whereas nominal GDP is inflation
adjusted.
C. There is no difference between the two.
D. Real GDP measures unemployment in current years, whereas nominal GDP measures unemployment in
past years.
E. Nominal GDP measures inflation, whereas real GDP does not measure unemployment.
10. What does the price index measure?
A. Unemployment
B. Ta xe s
C. The underground economy
D. Price levels
E. GDP- What does Gross Domestic Product consist of?
A. Taxes, military expenditures, and welfare
B. Personal consumption, investment, and government purchases
C. Savings, income, and taxes
D. Goods, services, and taxes
E. Savings appreciation and goods
Part II: Macroeconomics