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What event was a major influence on the development of macroeconomics?
GDP can be found by adding up either all of the _____ or all of the _____ in the economy.
spending; income
Gross domestic product is a measure of
Gross domestic product is the total market value of all
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Total spending in an economy is the sum of
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The three types of consumption are
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Which of these is a nondurable good?
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Which of these is an example of gross private domestic investment?
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The principal measure of inflation in the United States is
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_____ is a reduction in the rate of inflation.
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_____ is a measure of the change in the average prices paid by urban consumers for a typical market basket of goods and services.
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What is real GDP in 2010 dollars if nominal GDP in 2014 is $15,000 billion; the GDP deflator in 2014 is 110; and the GDP deflator in 2010 was 100?
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What is the rate of inflation if last year the consumer price index was 115 and this year it is 125?
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If the cost of a typical market basket in 2019 is 400 and the cost in 2020 is 390, then during this period the economy is undergoing
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What was the real GDP for 2006 if nominal GDP was $13,458.2 billion and the GDP deflator was 116.9?
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If Janet is receiving a 5% pay raise and the rate of inflation is 2%, then Janet's purchasing power is
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If John's salary last year was $50,000 and the CPI increased from 160 to 164, what salary does he expect to earn this year?
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Which group benefits from an unanticipated rise in the inflation rate?
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According to the Bureau of Labor Statistics, what is Zach's employment status if he has been looking for a job for the past six weeks?
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Study Notes
Macroeconomics
- The Great Depression was a major influence on the development of macroeconomics.
GDP
- GDP measures the total market value of all final goods and services produced in an economy.
- Can be calculated by adding up all spending or all income in the economy.
- It is the total value of all final goods and services produced in a country, excluding intermediate goods.
- Final goods and services are goods and services sold to their final users and not resold.
- Intermediate goods are goods and services used in the production of final goods and services.
Components of GDP
- Includes personal consumption expenditures, gross private domestic investment, government spending, and net exports.
- Personal consumption expenditures include spending on durable goods, nondurable goods, and services.
- Gross private domestic investment includes spending on new plants, equipment, and inventory by businesses.
- Government spending includes spending on goods and services, including infrastructure and salaries for government workers.
- Net exports are the value of exports minus the value of imports.
Types of Goods
- Durable goods are goods that last for a long time, such as cars, appliances, and furniture.
- Nondurable goods are goods that are used up quickly, such as food, clothing, and gasoline.
- Services are intangible goods, such as haircuts, medical care, and transportation.
Inflation
- Inflation is a sustained increase in the general price level of goods and services in an economy over a period of time.
- Disinflation is a reduction in the rate of inflation.
- Deflation is a sustained decrease in the general price level of goods and services in an economy over a period of time.
Measuring Inflation
- The primary inflation measure in the United States is the Consumer Price Index (CPI).
- The Consumer Price Index (CPI) measures the change in the average prices paid by urban consumers for a typical market basket of goods and services.
- The Producer Price Index (PPI) measures the change in the average prices received by domestic producers for their output.
- The GDP deflator is a price index that measures the change in the average prices of all goods and services produced in an economy.
- The GDP deflator reflects the change in the price level of all goods and services produced in an economy.
Real vs. Nominal GDP
- Nominal GDP is the value of goods and services produced in an economy at current market prices.
- Real GDP is the value of goods and services produced in an economy adjusted for inflation.
Unemployment
- The unemployment rate is the percentage of the labor force that is unemployed.
- The labor force is the total number of people who are either employed or unemployed.
- People are considered unemployed if they are not working and are actively looking for a job.
- People are considered employed if they are working.
- Discouraged workers are people who are not working and are not actively looking for work because they believe that no jobs are available.
- Discouraged workers are not included in the unemployment rate.
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Description
This quiz covers key concepts in macroeconomics, particularly focusing on GDP and its components. Understand the factors that contribute to GDP, including personal consumption, investment, government spending, and net exports. Test your knowledge on the significance of final and intermediate goods in the economy.
