Which Of The Following Statements Regarding Convenience Goods And Services Is Accurate
Macroeconomic Principles (Econ 2305)
Quiz 1
Proper noun : ______________________ SSN : _________________
1. Comparative reward is based on
a. capital letter costs.
b. labor costs.
c. dollar price.
d. opportunity costs.
Reply: d. opportunity costs.
| Labor Hours Needed to Make one Pound of: | Pounds produced in xl hours: |
| Meat | Potatoes | Meat | Potatoes | |
| Farmer | 8 | 2 | 5 | 20 |
| Rancher | 4 | five | 10 | 8 |
2. According to the tabular array, the opportunity price of i pound of meat for the farmer is
a. ane/4 hour of labor.
b. 4 hours of labor.
c. 4 pounds of potatoes.
d. i/4 pound of potatoes.
Answer: c. four pounds of potatoes.
3. According to the tabular array, the Rancher has an absolute advantage in
a. both goods, and the Farmer has a comparative advantage in meat.
b. meat, and the Farmer has a comparative advantage in potatoes.
c. meat, and the Farmer has a comparative advantage in neither practiced.
d. both appurtenances, and the Farmer has a comparative reward in potatoes.
ANSWER: b. meat, and the Farmer has a comparative advantage in potatoes.
4. A professional gambler moves from a state where gambling is illegal to a land where gambling is legal. This motility
a. necessarily raises Gross domestic product.
b. necessarily decreases GDP.
c. doesn�t change Gdp considering gambling is never included in Gross domestic product.
d. doesn�t change GDP because in either example his income is included.
Reply: a. necessarily raises Gdp.
five. To compute Gdp we
a. simply sum the number of last goods and services.
b. sum the cost of producing last goods and services.
c. apply weights determined past a survey regarding how much people value unlike sorts of appurtenances and services to compute GDP as a weighted average.
d. sum the market values of final appurtenances and services.
Respond: d. sum the market values of final goods and services.
6. Which of the following statements virtually nominal Gross domestic product and real GDP is well-nigh accurate?
a. Nominal GDP is a better guess of economical well-being than is real Gross domestic product.
b. Existent GDP is a better estimate of economic well-being than is nominal Gdp.
c. Real Gross domestic product and nominal GDP are equally practiced measures of economical well-being.
d. Whether real Gdp or nominal Gdp is a better measure of economic well-being depends on what sort of goods are produced.
ANSWER: b. Existent Gdp is a better estimate of economic well-existence than is nominal Gdp.
| year | peaches | pecans |
| 2000 | $eleven per bushel | $6 per bushel |
| 2001 | $9 per bushel | $10 per bushel |
7. Suppose that the typical consumer handbasket consists of 10 bushels of peaches and 15 bushels of pecans and that the base yr is 2000. What is the consumer toll index for 2001?
a. 100
b. 120
c. 200
d. 240
Respond: b. 120
8. What was the inflation rate in 2001?
a. xx percent
b. 16.7 percent
c. x percentage
d. 8 per centum
ANSWER: a. 20 percent
9. The substitution bias in the consumer cost index refers to the
a. substitution of new appurtenances for old goods in the purchases of consumers.
b. commutation of quality for quantity in consumer purchases over time.
c. fact that consumers substitute toward goods that take get relatively less expensive.
d. substitution of new prices for old prices in the basket of appurtenances from one year to the side by side.
ANSWER: c. fact that consumers substitute toward goods that have go relatively less expensive.
a. is nearly the aforementioned across countries and and so provides no help explaining differences across countries in the standard of living.
b. explains very little of the differences across countries in the standard of living.
c. explains some, but non about of the differences across countries in the standard of living.
d. explains about of the differences across countries in the standard of living.
ANSWER: d. explains about of the differences across countries in the standard of living.
a. a new factory building
b. a figurer used to aid Mercury Delivery Service continue track of their orders
c. on-the-job training
d. a desk-bound used in an accountant�southward role
Answer: c. on-the-job training
a. slower than relatively rich countries; this is called the poverty trap.
b. slower than relatively rich countries; this is called the Malthus upshot.
c. faster than relatively rich countries; this is called the take hold of-upward effect.
d. faster than relatively rich countries; this is called the constant-returns-to-scale effect.
Reply: c. faster than relatively rich countries; this is chosen the grab-upwards effect.
13. According to the graph, if Paul divides his fourth dimension every bit betwixt corn and wheat, he will exist able to produce
a. 2 bushels of wheat and 2 bushels of corn.
b. 3 bushels of wheat and 3 bushels of corn.
c. 4 bushels of wheat and 5 bushels of corn.
d. 4 bushels of wheat and 6 bushels of corn.
ANSWER: c. 4 bushels of wheat and 5 bushels of corn.
xiv. According to the graph, the opportunity cost of 1 bushel of wheat for Cliff is
a. 1/3 bushel of corn.
b. 2/3 bushel of corn.
c. ane bushel of corn.
d. three/2 bushels of corn.
Reply: b. 2/3 bushel of corn.
15. Trade is based on
a. absolute advantage.
b. comparative advantage.
c. production costs.
d. relative dollar prices.
Respond: b. comparative advantage.
16. In a unproblematic round-flow diagram, full income and full expenditures in an economy are
a. equal because firms are ultimately owned by households.
b. equal but if there is no saving.
c. equal because every transaction has a buyer and a seller.
d. never equal because some people�s income is not for production.
ANSWER: c. equal considering every transaction has a buyer and a seller.
17. Which of the post-obit is the right definition of Gdp?
a. the market value of all goods produced within a country
b. the market place value of all last goods and services produced by the citizens of a state
c. the market place value of all terminal goods and services produced within a land
d. None of the higher up are right.
ANSWER: c. the marketplace value of all concluding goods and services produced within a country
eighteen. Which of the following is right?
a. The value of all intermediate goods and last goods are included in GDP.
b. The value of intermediate goods are included in Gdp only if they were produced in the previous twelvemonth.
c. The value of intermediate appurtenances are included in GDP only if they are purchased by firms rather than households.
d. The value of intermediate goods are not included in GDP.
Reply: d. The value of intermediate goods are not included in Gdp.
19. In 2008, OPEC succeeds in raising globe oil prices by 300 percentage. This price increase causes inventors to look at alternative sources of fuel for internal-combustion engines. A hydrogen-powered engine is developed which is cheaper to operate than gasoline engines. Which trouble in the construction of the CPI does this state of affairs stand for?
a. substitution bias and introduction of new goods
b. introduction of new appurtenances and unmeasured quality change
c. unmeasured quality change and new goods.
d. income bias and exchange bias
Respond: a. substitution bias and introduction of new goods
twenty. An important difference between the Gdp deflator and the consumer cost alphabetize is that
a. the GDP deflator reflects the prices of goods and services bought by producers, whereas the consumer toll alphabetize reflects the prices of goods and services bought by consumers.
b. the GDP deflator reflects the prices of all final goods and services produced domestically, whereas the consumer cost index reflects the prices of some goods and services bought by consumers.
c. the Gross domestic product deflator reflects the prices of all last goods and services produced past a nation's citizens, whereas the consumer toll alphabetize reflects the prices of concluding goods and services bought by consumers.
d. the Gdp deflator reflects the prices of all goods and services bought by producers and consumers, whereas the consumer price index reflects the prices of final goods and services bought by consumers.
ANSWER: b. the Gdp deflator reflects the prices of all concluding appurtenances and services produced domestically, whereas the consumer price alphabetize reflects the prices of some goods and services bought by consumers.
21. Which of the post-obit is the most accurate argument most the relationship between the nominal involvement rate and the real interest charge per unit?
a. The existent interest charge per unit is the nominal interest charge per unit times the charge per unit of inflation.
b. The real interest charge per unit is the nominal involvement rate minus the rate of inflation.
c. The real interest charge per unit is the nominal involvement rate plus the rate of aggrandizement.
d. The real involvement rate is the nominal interest rate divided by the charge per unit of aggrandizement.
Reply: b. The real involvement rate is the nominal interest rate minus the rate of aggrandizement.
22. Gary Becker has proposed programs like Mexico�due south Progressa to reduce kid labor and increment educational levels.
a. If successful, these programs will enhance productivity by increasing homo capital.
b. In United mexican states these programs have decreased differences in the level of education obtained by girls and boys.
c. Such programs might be funded by reducing money spent on universities and educational activity of the elite.
d. All of the above are right.
Reply: d. All of the above are correct.
23. The President of a developing country proposes that his country needs to assist domestic firms by imposing trade restrictions.
a. These are outward-oriented policies and most economists believe they would have benign furnishings on growth.
b. These are outward-oriented policies and most economists believe they would take adverse effects on growth.
c. These are inward-oriented policies and virtually economists believe they would have beneficial effects on growth.
d. These are inwards-oriented policies and near economists believe they would have agin effects on growth.
Reply: d. These are inward oriented policies and about economists believe they would have adverse effects on growth.
24. Which of the following is correct?
a. Kremer argued that with greater population, lodge would generate more than ideas so that growth of real Gdp per person could continue. Malthus argued that increasing population would outstrip agricultural production.
b. Kremer argued that increases in population would reduce the corporeality of homo and physical capital letter per worker so that somewhen the standard of living would decline. Malthus argued that increases in applied science would allow increased output growth so that even with population growth, society would enjoy a higher standard of living.
c. Malthus argued that with greater population, society would generate more ideas so that growth of real GDP per person could continue. Kremer argued that increasing population would outstrip agricultural production.
d. Malthus argued that increases in population would reduce the corporeality of human being and physical upper-case letter per worker so that eventually the standard of living would pass up. Kremer argued that increases in technology would allow increased output growth then that even with population growth, society would bask a higher standard of living.
ANSWER: a. Kremer argued that with greater population, guild would generate more ideas so that growth of real GDP per person could continue. Malthus argued that increasing population would outstrip agricultural production.
25. For two people who are planning to trade, it is incommunicable to
a. have a comparative advantage in both goods.
b. have an absolute advantage in both goods.
c. specialize in the production of one skillful.
d. trade then that both people will be improve off.
Respond: a. accept a comparative reward in both goods.
26. Mike and Sandy are two woodworkers who both make tables and chairs. In one calendar month, Mike can make 4 tables or twenty chairs, where Sandy can brand 6 tables or xviii chairs. Given this, we know that
a. Mike has a comparative reward in tables.
b. Sandy has an absolute advantage in chairs.
c. Mike has an absolute advantage in tables.
d. Sandy has a comparative reward in tables.
Answer: d. Sandy has a comparative advantage in tables.
27. Anna, a U.S. citizen, works only in Germany. The value added to production from her employment is included
a. only in U.S. GDP.
b. merely in German GDP.
c. in both German language and U.South. GDP.
d. in neither German language nor U.S. Gdp.
Reply: b. merely in German GDP.
28. If you buy a burger and fries at your favorite fast food eatery
a. neither GDP nor consumption spending volition be afflicted because you would have eaten at home if you hadn't eaten at the restaurant.
b. Gdp will exist higher, just consumption spending will be unchanged.
c. Gross domestic product will exist unchanged, just consumption spending will be higher.
d. both GDP and consumption spending volition be college.
ANSWER: d. both Gross domestic product and consumption spending will be higher.
29. Suppose that the real interest charge per unit was 3 percent and the inflation rate was 1 per centum.
a. The dollar value of savings increased at 2 pct, and the value of savings measured in goods increased at 3 percentage.
b. The dollar value of savings increased at i percentage, and the value of savings measured in goods increased at ii percent.
c. The dollar value of savings increased at 3 percent, and the value of savings measured in goods increased at 1 pct.
d. The dollar value of savings increased at 4 percent, and the value of savings measured in goods increased at 3 percent.
Answer: d. The dollar value of savings increased at 4 percent, and the value of savings measured in appurtenances increased at 3 pct.
30. Which of the following have been suggested as remedies for depression growth in many African countries?
a. reduce corporate taxes
b. cut import tariffs and end consign taxes on agronomical products
c. focus authorities spending on bones public health, educational activity, and internal guild
d. All of the above are correct.
ANSWER: d. All of the above are correct.
Source: https://www.uh.edu/~trdegreg/quiz%201%20solution.htm
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