1. Among the tools available to macroeconomicpolicy makers is _______. (Points:

Question

1. Among the tools available to macroeconomicpolicy makers is _______. (Points: 1)
      fiscal policy, control of government spending,and taxation
       anti-trust policy, to breakup monopolies
       environmental policy, toclean up the economy
       all of theabove


2. The labor force is ______. (Points: 1)
       the total of peopleemployed
       the totalpopulation
       the total of thepopulation of working age
       the total of peopleemployed and unemployed


3. Secular long-run growth is the sustainedupward trend in ______. (Points: 1)
       aggregate outputper person over several decades
       nominal GDP overtime
       real GDP overtime
       aggregate output per personover the business cycle


4. Real wages ______. (Points: 1)
       have not been adjusted forchange in prices over time
       have been adjustedfor changes in prices over time
       are after-taxwages
       are wages as a ratio of theminimum wage


5. As opposed to a closed economy, in an openeconomy _______. (Points: 1)
       the exchange rate isdetermined by the government
       specialization inactivities with a comparative advantage is not possible
       trade is only beneficial tothe relatively larger economy
       there is trade ingoods, services, or assets with other countries


6. Disposable income in a particular periodis _______. (Points: 1)
       total incomeearned
       income earned plusgovernment transfer payments
       income earned plusgovernment transfer payments less taxes
       income earned plusgovernment transfer payments less taxes and savings


7. An example of investment spending would be______. (Points: 1)
       purchase of abond
       purchase of a loaf ofbread
       purchase of a newproductive machine
       all of theabove


8. If both aggregate output and the aggregateprice level increase ______. (Points: 1)
       real GDP willincrease faster than nominal GDP
       nominal GDP will increasefaster than real GDP
       it makes no difference toreal or nominal GDP
       either A or B may becorrect


9. The official unemployment rate ignores_______. (Points: 1)
       people with professionaljobs
       people who work oncommission
       discouraged workerswho have given up looking for a job
       all of theabove


10. Many economists believe that the CPIoverstates inflation because ______. (Points: 1)
       innovation forcesconsumers to pay more for most goods and services
       the Bureau of LaborStatistics collects data on the prices of only a few goods andservices
       the CPI marketbasket doesn't reflect the fact that consumers shift consumptionaway from more expensive goods
       people use it to bargainfor wage increases

Explanation / Answer

                PLEASE RATE lifesaver as you may or maynot know there is only suppose to be 1 problem per question and this tooksome time to do.....thanks Mathtut 1 is correct 2) is incorrect ....d)thetotal of people employed and unemployed
3)is correct 4)correct........Real= nominal wages- inflation...realwages refers to wages that have been adjusted forinflation 5) correct.....closed economy is a self-containedeconomic unit that has no business or trading relations with anyoneoutside of that unit. In an open economy people areallowed to trade their goods and services with othereconomies. 6)Incorrect. C) incomeearned plus government transfer payments less taxesIn simple terms, "disposable income" is whatevermoney you have left after paying all required taxes and nationalinsurances! Disposableincome isdefined as total incomeplustransferpayments minustaxes. Savings should not be included in this figure 7)incorrect C) purchase of a new productivemachine. investment refers toinvestment spending on productiveassets 8) not sure about this one 9) correct 10)correct...........Some economists haveargued that the CPI overstates inflation because it fails to takeinto account that when the price of a good rises, people tend tosubstitute a similar, lower-priced good. For instance, if the priceof beef were to rise sharply, the CPI would incorporate the fullrise into the index, but consumers would likely buy less beef andshift to cheaper foods like chicken, thereby keeping net spendingon food relatively stable.

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