lOMoAR cPSD| 784381
lOMoAR cPSD| 784381
Econ+13++Hwk1-Key - Homework question and
answer
Global Economy (University of California Irvine)
UCI
Econ / IS 13
Homework 1 (100 points)
Check answers here http://bit.ly/3cPUKd1
Multiple Choice (1 point each) Identify the choice that best completes the statement or answers the question.
1. Economic models
a. cannot be useful if they are based on false assumptions.
b. were once thought to be useful, but that is no longer true.
c. must incorporate all aspects of the economy if they are to be useful.
d. can be useful, even if they are not particularly realistic.
Figure 2-6
45
40
35
30
25
20
15
10
5
2
4
6
8
10
12
14
16
clocks
Check answers here http://bit.ly/3cPUKd1
2. Refer to Figure 2-6. What is the opportunity cost of moving from point A to point B?
a. zero
b. 6 clocks
c. 6 clocks and 15 candles
d. 15 candles
Figure 2-7
2800
2400
2000
1600
1200
lOMoAR cPSD| 784381
800
400
400
800
1200
hammers
3. Refer to Figure 2-7. Inefficient production is represented by which point(s)?
a.
b.
c.
d.
K, M
L
L, M
M
Check answers here http://bit.ly/3cPUKd1
Figure 2-8
Panel (a)
Panel (b)
7
7
6.5
6.5
6
6
5.5
5.5
5
5
4.5
4.5
4
4
3.5
3.5
3
3
2.5
2.5
2
2
1.5
1.5
1
1
0.5
0.5
lOMoAR cPSD| 784381
1
2
3
4
5
6
donuts
1
2
3
4
5
6
donuts
4. Refer to Figure 2-8, Panel (a). Production is
a. possible at points J, K, L, and M, but efficient only at points J, L, and M.
b. possible at points J, K, L, and M, but efficient only at point K.
c. possible at points J, L, M, and N, but efficient only at points J, L, and M.
d. possible at points J, L, M, and N, but efficient only at point N.
Check answers here http://bit.ly/3cPUKd1
5. Refer to Figure 2-8, Panel (a) and Panel (b). Which of the following is not a result of the shift of the
economy’s production possibilities frontier from Panel (a) to Panel (b)?
a. the tradeoff between the production of donuts and coffee changes
b. the opportunity cost of a cup of coffee is higher at all levels of coffee production
c. production of 4 donuts and 2 cups of coffee becomes possible
d. production of 1 donut and 4 cups of coffee becomes efficient
6. Which of the following is not an example of a positive, as opposed to normative, statement?
a. Higher gasoline prices will reduce gasoline consumption.
b. Equality is more important than efficiency.
c. Trade restrictions lower our standard of living.
If a nation wants to avoid inflation, it will restrict the growth rate of the quantity of money.
Check answers here http://bit.ly/3cPUKd1
d.
7. Which of the following is an example of a normative, as opposed to positive, statement?
a. Gasoline prices ought to be lower than they are now.
b. The federal government should raise taxes on wealthy people.
c. The social security system is a good system and it deserves to be preserved as it is.
d. All of the above are normative statements.
Figure 3-6
Maxine’s Production Possibilities Frontier
Daisy’s Production Possibilities Frontier
20
20
18
18
16
16
14
14
12
12
10
10
8
8
6
6
4
4
2
2
3
6
9
12
15
18
21
24 27
30
pies
3
6
9
12
15
18
21
24
27
30
pies
8. Refer to Figure 3-6. If the production possibilities frontier shown for Maxine is for 3 hours of work, then
how long does it take Maxine to make one pie?
a. 1/4 hour
b. 1/3 hour
lOMoAR cPSD| 784381
3 hours Check answers here http://bit.ly/3cPUKd1
c.
d. 4 hours
Figure 3-11
The graph below represents the various combinations of ham and cheese (in pounds) that the nation of
Bonovia could produce in a given month.
360
320
280
240
200
160
120
80
40
40
80
120
160
200
240
280
320 360
400
Ham
( in pounds)
9. Refer to Figure 3-11. If the production possibilities frontier shown is for 240 hours of production, then
which of the following combinations of ham and cheese could Bonovia produce in 240 hours?
a. 225 pounds of ham and 140 pounds of cheese
b. 280 pounds of ham and 100 pounds of cheese
c. 355 pounds of ham and 80 pounds of cheese
d. 330 pounds of ham and 60 pounds of cheese
10. Refer to Figure 3-11. For Bonovia, what is the opportunity cost of a pound of cheese?
a. 0.8 pounds of ham
b. 1.25 pounds of ham
c. 8 pounds of ham
d. 16 pounds of ham
Figure 3-5
Hosne’s Production Possibilities Frontier
Merve’s Production Possibilities Frontier
10
10
9
9
8
8
7
7
6
6
5
5
4
4
3
3
2
2
1
1
1
2
3
4
5
6
7
8
9
10
purses
1
2
3
4
5
6
7
8
9 10 purses
lOMoAR cPSD| 784381
11. Refer to Figure 3-5. Hosne should specialize in the production of
a. purses.
b. wallets.
c. both goods.
d. neither good. Check answers here http://bit.ly/3cPUKd1
Figure 3-7
Bintu’s Production Possibilities Frontier
Juba’s Production Possibilities Frontier
10
10
9
9
8
8
7
7
6
6
5
5
4
4
3
3
2
2
1
1
1
2
3
4
5
6
7
8
bowls
1
2
3
4
5
6
7
8
bowls
12. Refer to Figure 3-7. The opportunity cost of 1 cup for Bintu is
a. 1/8 bowl.
b. 1/4 bowl.
c. 4 bowls.
d. 8 bowls.
13. Tom Brady should probably not mow his own lawn because
a. his opportunity cost of mowing his lawn is higher than the cost of paying someone to mow
it for him.
b. he has a comparative advantage in mowing his lawn relative to a landscaping service.
c. he has an absolute advantage in mowing his lawn relative to a landscaping service.
d. he might sprain his ankle.
14. A group of buyers and sellers of a particular good or service is called a(n)
a. coalition.
b. economy.
c. market.
d. competition. Check answers here http://bit.ly/3cPUKd1
15. In a competitive market, the quantity of a product produced and the price of the product are determined by
a. buyers.
b. sellers.
c. both buyers and sellers.
d. None of the above is correct.
16. For a competitive market,
a. a seller can always increase her profit by raising the price of her product.
b. if a seller charges more than the going price, buyers will go elsewhere to make their
purchases.
c. a seller often charges less than the going price to increase sales and profit.
lOMoAR cPSD| 784381
d. a single buyer can influence the price of the product but only when purchasing from
several sellers in a short period of time.
17. An example of a perfectly competitive market would be the
a. cable TV market.
b. soybean market.
c. breakfast cereal market.
d. shampoo market.
18. Nemo rents 5 movies per month when the price is $3.00 per rental and 7 movies per month when the price is
$2.50 per rental. Nemo’s demand demonstrates the law of
a. price.
b. supply.
c. demand.
d. income.
Table 4-1
Price
$5
$4
$3
$2
$1
$0
Quantity Demanded
by Michelle
5
6
7
8
9
10
Quantity Demanded
by Laura
4
6
8
10
12
14
Quantity Demanded
by Hillary
11
13
15
17
19
21
19. Refer to Table 4-1. If the market consists of Michelle and Hillary only and the price falls by $1, the quantity
demanded in the market increases by
a. 2 units.
b. 3 units.
4 units. Check answers here http://bit.ly/3cPUKd1
c.
d. 5 units.
Table 4-2
Price
William’s
Quantity
Demanded
$12
2
$10
4
$8
6
$6
8
$4
10
$2
12
Fergie’s
Quantity
Demanded
1
4
7
8
9
10
Taboo’s
Quantity
Demanded
3
4
5
4
3
2
apl.de.ap’s
Quantity
Demanded
4
5
6
7
8
9
20. Refer to Table 4-2. Whose demand does not obey the law of demand?
a. William’s
b. Fergie’s
c. Taboo’s
d. apl.de.ap’s
Figure 4-4
lOMoAR cPSD| 784381
Quantity
21. Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand B to
Demand C in the market for DVDs in the United States?
a. a decrease in the price of DVDs
b. a decrease in the price of DVD players
c. a change in consumer preferences toward watching movies in movie theaters rather than at
home
d. a decrease in the number of people in the United States
22. Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand C to
Demand A in the market for tennis balls in the United States?
a. an increase in the price of tennis balls
b. a decrease in the price of tennis racquets
c. an expectation by buyers that their incomes will increase in the very near future
d. a decrease in the number of people in the United States under age 70
23. Which of the following would not shift the demand curve for mp3 players?
a. a decrease in the price of mp3 players
b. a fad that makes mp3 players more popular among 12-25 year olds
c. an increase in the price of digital music downloads, a complement for mp3 players
d. a decrease in the price of satellite radio, a substitute for mp3 players
24. Each of the following is a determinant of demand except
a. tastes.
b. production technology.
c. expectations.
d. the prices of related goods.
25. If muffins and bagels are substitutes, a higher price for bagels would result in a(n)
a. increase in the demand for bagels.
decrease in the demand for bagels. Check answers here http://bit.ly/3cPUKd1
b.
c. increase in the demand for muffins.
d. decrease in the demand for muffins.
26. A higher price for batteries would result in a(n)
a. increase in the demand for flashlights.
b. decrease in the demand for flashlights.
c. increase in the demand for batteries.
lOMoAR cPSD| 784381
d. decrease in the demand for batteries.
27. You love peanut butter. You hear on the news that 50 percent of the peanut crop in the South has been wiped
out by drought and that this will cause the price of peanuts to double by the end of the year. As a result, your
demand for peanut butter
a. will increase but not until the end of the year.
b. increases today.
c. decreases as you look for a substitute good.
d. shifts left today.
28. Which of these statements best represents the law of supply?
a. When input prices increase, sellers produce less of the good.
b. When production technology improves, sellers produce less of the good.
c. When the price of a good decreases, sellers produce less of the good.
d. When sellers’ supplies of a good increase, the price of the good increases.
29. A supply schedule is a table that shows the relationship between
a. price and quantity supplied.
b. input costs and quantity supplied.
c. quantity demanded and quantity supplied.
d. profit and quantity supplied.
Figure 4-10
Quantity
30. Refer to Figure 4-10. Which of the following would cause the supply curve to shift from Supply B to
Supply A in the market for tennis racquets?
a. a decrease in the price of tennis balls
b. an expectation by firms that the price of tennis racquets will increase in the very near
future
c. a decrease in the price of tennis racquet strings
d. an improvement in technology that allows firms to use less labor in the production of
tennis racquets
31. If something happens to alter the quantity supplied at any given price, then
a. we move along the supply curve.
b. the supply curve shifts.
c. the supply curve becomes steeper.
the supply curve becomes flatter. Check answers here http://bit.ly/3cPUKd1
d.
lOMoAR cPSD| 784381
32. In a market, to find the total amount supplied at a particular price, we must
a. sum the quantities that individual firms are willing and able to supply at that price.
b. calculate the average of the quantities that individual firms are willing and able to supply
at that price.
c. sum the costs that individual firms incur to supply the product at that price.
d. account for all determinants of demand.
Figure 4-11
Firm A
Firm B
20
20
18
18
16
16
14
14
12
12
10
10
8
8
6
6
4
4
2
2
2
4
6
8
10
12
14
16
18 20
quantity
2
4
6
8 10 12 14 16 quantity
33. Refer to Figure 4-11. If these are the only two sellers in the market, then the market quantity supplied at a
price of $4 is
a. 6 units.
b. 7 units.
c. 8 units.
d. 14 units.
Figure 4-13
quantity
34. Refer to Figure 4-13. The shift from S to S’ is called a(n)
a. decrease in supply.
lOMoAR cPSD| 784381
b. decrease in quantity supplied.
c. increase in supply.
d. increase in quantity supplied.
35. Buyers are able to buy all they want to buy and sellers are able to sell all they want to sell at
a. prices at and above the equilibrium price.
b. prices at and below the equilibrium price.
c. prices above and below the equilibrium price, but not at the equilibrium price.
d. the equilibrium price but not above or below the equilibrium price.
36. When supply and demand both increase, equilibrium
a. price will increase.
b. price will decrease.
c. quantity may increase, decrease, or remain unchanged.
price may increase, decrease, or remain unchanged.
Check answers here http://bit.ly/3cPUKd1
d.
Table 4-6
An Increase in Demand
A Decrease in Demand
An Increase in Supply
A
C
A Decrease in Supply
B
D
37. Refer to Table 4-6. Which combination would produce an increase in equilibrium quantity and an
indeterminate change in equilibrium price?
a. A
b. B
c. C
d. D
38. Suppose roses are currently selling for $20 per dozen, but the equilibrium price of roses is $30 per dozen. We
would expect a
a. shortage to exist and the market price of roses to increase.
b. shortage to exist and the market price of roses to decrease.
c. surplus to exist and the market price of roses to increase.
d. surplus to exist and the market price of roses to decrease.
Table 4-7
Price
$10
$8
$6
$4
$2
Quantity
Demanded
10
20
30
40
50
Quantity
Supplied
60
45
30
15
0
39. Refer to Table 4-7. The equilibrium price and quantity, respectively, are
a. $2 and 50 units.
b. $6 and 30 units.
c. $6 and 60 units.
d. $12 and 30 units.
lOMoAR cPSD| 784381
Figure 4-17
50
45
40
35
30
S
25
20
15
10
D
5
100 200 300 400 500 600 700 800 900 quantity
40. Refer to Figure 4-17. If the price is $10, then there would be a
a. shortage of 400 units, and price would rise.
b. surplus of 400 units, and price would rise.
c. shortage of 600 units, and price would rise.
d. surplus of 600 units, and price would rise.
Figure 4-18
20
18
16
14
12
10
8
6
4
2
1
2
3
4
5
6
7
8
9 10 quantity
41. Refer to Figure 4-18. What is the equilibrium price in this market?
a. $0
b. $5
c. $7.50
d. $10
42. What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up, the
price of jelly fell, fewer firms decided to produce peanut butter, and health officials announced that eating
peanut butter was good for you?
a. Price will fall, and the effect on quantity is ambiguous.
b. Price will rise, and the effect on quantity is ambiguous.
c. Quantity will fall, and the effect on price is ambiguous.
lOMoAR cPSD| 784381
d. Quantity will rise, and the effect on price is ambiguous.
Figure 4-22
Panel (a)
Panel (b)
Pe'
Pe
Pe
Pe'
Qe
Qe'
Qe'
quantity
Panel (c)
Pe'
Pe'
Pe
Qe'
quantity
Panel (d)
Pe
Qe
Qe
quantity
Qe'
Qe
quantity
43. Refer to Figure 4-22. Which of the four panels represents the market for peanut butter after a major
hurricane hits the peanut-growing south?
a. Panel (a)
b. Panel (b)
c. Panel (c)
d. Panel (d)
44. Which of the following is a way to compute GDP?
a. add up the wages paid to all workers
b. add up the quantities of all final goods and services
c. add up the market values of all final goods and services
d. add up the difference between the market values of all final goods and services and then
subtract the costs of producing those goods and services
45. Which of the following is not included in GDP? Check answers here http://bit.ly/3cPUKd1
a. carrots grown in your garden and eaten by your family
lOMoAR cPSD| 784381
b. carrots purchased at a farmer’s market and eaten by your family
c. carrots purchased at a grocery store and eaten by your family
d. None of the above are included in GDP.
46. One bag of flour is sold for $1.00 to a bakery, which uses the flour to bake bread that is sold for $3.00 to
consumers. A second bag of flour is sold for $1 to a grocery store who sells it to a consumer for $2.00.
Taking these four transactions into account, what is the effect on GDP?
a. GDP increases by $3.00.
b. GDP increases by $5.00.
c. GDP increases by $6.00.
d. GDP increases by $7.00.
47. Gross domestic product includes all
a. legal and illegal final goods, but it excludes all legal and illegal final services.
b. legal and illegal final goods and all legal and illegal final services.
c. legal final goods and services, but it excludes illegal final goods and services.
d. legal and illegal final goods and legal final services, but it excludes illegal final services.
48. Which of the following items is included in U.S. GDP?
a. the estimated value of production accomplished at home, such as backyard production of
fruits and vegetables
b. the value of illegally-produced goods and services
c. the value of cars and trucks produced in foreign countries and sold in the U.S.
d. None of the above is included in U.S. GDP.
49. Which of the following represents a transfer payment?
a. You transfer $1,000 from your bank account to a mutual fund.
b. The government sends your grandfather his Social Security check.
c. You make a payment to get legal documents showing you purchased a previously owned
home.
d. Your employer automatically transfers $100 each month from your wages to a non-taxable
medical spending account.
50. If a U.S. citizen buys a dress made in Nepal by a Nepalese firm, then
a. U.S. consumption increases, U.S. net exports decrease, and U.S. GDP decreases.
b. U.S. consumption increases, U.S. net exports decrease, and U.S. GDP is unaffected.
c. U.S. consumption decreases, U.S. net exports increase, and U.S. GDP increases.
d. U.S. consumption decreases, U.S. net exports increase, and U.S. GDP is unaffected.
51. In the economy of Ukzten in 2010, consumption was $3000, GDP was $5500, government purchases were
$1000, imports were $2000, and investment was $1000. What were Ukzten’s exports in 2010?
a. -$1500
b. $500
c. $1500
d. $2500
52. Which of the following statements about nominal GDP and real GDP is correct? Check answers here
http://bit.ly/3cPUKd1
a. Nominal GDP is a better gauge of economic well-being than real GDP.
b. Real GDP is a better gauge of economic well-being than nominal GDP.
c. Real GDP and nominal GDP are equally good measures of economic well-being.
d. Neither nominal nor real GDP provide a measure of economic well-being.
lOMoAR cPSD| 784381
53. Suppose an economy produces only burgers and bags of fries. In 2010, 4000 burgers are sold at $3 each and
6000 bags of fires are sold at $1.50 each. In 2008, the base year, burgers sold for $2.50 each and bags of fries
sold for $2 each.
a. nominal GDP is $22,000 real GDP is $21,000, and the GDP deflator is 95.45.
b. nominal GDP is $22,000, real GDP is $21,000, and the GDP deflator is 104.77.
c. nominal GDP is $21,000, real GDP is $22,000, and the GDP deflator is 95.45.
d. nominal GDP is $21,00, real GDP is $22,000, and the GDP deflator is 104.77.
Table 23-5
A hypothetical country of Lahland produces only movies and popcorn. Quantities and prices of these goods
for the last several years are shown below. The base year is 2009.
Year
2008
2009
2010
2011
Price of
Movies
$10.00
$11.00
$12.00
$12.00
Prices and Quantities
Quantity of
Price of
Movies
Popcorn
400
$5
500
$4
600
$5
600
$6
Quantity of
Popcorn
800
900
1000
900
54. Refer to table 23-5 What was this country’s GDP deflator in 2010?
a. 86.9
b. 115.1
c. 120.5
d. None of the above is correct.
55. A recession has traditionally been defined as a period during which
a. nominal GDP declines for two consecutive quarters.
b. nominal GDP declines for four consecutive quarters.
c. real GDP declines for two consecutive quarters.
d. real GDP declines for four consecutive quarters.
56. Which of the following statements is correct?
a. The CPI can be used to compare dollar figures from different points in time.
b. The percentage change in the CPI is a measure of the inflation rate, but the percentage
change in the GDP deflator is not a measure of the inflation rate.
c. Compared to the consumer price index (CPI), the GDP deflator is the more common
gauge of inflation.
d. The GDP deflator better reflects the goods and services bought by consumers than does
the CPI.
57. The price index was 120 in 2006 and 127.2 in 2007. What was the inflation rate?
a. 5.7 percent
b. 6.0 percent
c. 7.2 percent
d. 27.2 percent
58. If the price index was 90 in year 1, 100 in year 2, and 95 in year 3, then the economy experienced
a. 10 percent inflation between years 1 and 2 ,and 5 percent inflation between years 2 and 3.
b. 10 percent inflation between years 1 and 2, and 5 percent deflation between years 2 and 3.
lOMoAR cPSD| 784381
c. 11.1 percent inflation between years 1 and 2, and 5 percent inflation between years 2 and
3.
d. 11.1 percent inflation between years 1 and 2, and 5 percent deflation between years 2 and
3.
Table 24-1 Check answers here http://bit.ly/3cPUKd1
The table below pertains to Pieway, an economy in which the typical consumer’s basket consists of 10
bushels of peaches and 15 bushels of pecans.
Year
2005
2006
Price of
Peaches
$11 per bushel
$9 per bushel
Price of
Pecans
$6 per bushel
$10 per bushel
59. Refer to Table 24-1. If 2005 is the base year, then the CPI for 2005 was
a. 83.3.
b. 100.
c. 120.
d. 200.
60. Refer to Table 24-1. If 2006 is the base year, then the CPI for 2005 was
a. 83.3.
b. 100.
c. 120.
d. 200.
Table 24-2
The table below pertains to Iowan, an economy in which the typical consumer’s basket consists of 3 pounds
of pork and 4 bushels of corn.
Year
2008
2009
Price of
Pork
$20 per pound
$25 per pound
Price of
Corn
$12 per bushel
$18 per bushel
61. Refer to Table 24-2. If 2008 is the base year, then the inflation rate in 2009 was
a. 26.5 percent.
b. 36.1 percent.
c. 39 percent.
d. 47 percent.
62. Refer to Table 24-2. If 2009 is the base year, then the inflation rate in 2009 was
a. 26.5 percent.
b. 36.1 percent.
c. 39 percent.
d. 47 percent.
Table 24-3
lOMoAR cPSD| 784381
The table below pertains to Studious, an economy in which the typical consumer’s basket consists of 5 books
and 10 calculators.
Year
2006
2007
2008
Price of a
Book
$24
$30
$32
Price of a
Calculator
$8
$12
$15
63. Refer to Table 24-3. The cost of the basket in 2006 was
a. $32.
b. $200.
c. $280.
d. $480. Check answers here http://bit.ly/3cPUKd1
64. In the basket of goods that is used to compute the consumer price index, the three largest categories of
consumer spending are
a. housing, transportation, and recreation.
b. housing, transportation, and food & beverages.
c. housing, food & beverages, and education & communication.
d. housing, medical care, and education & communication.
65. Which of these events would cause the consumer price index to overstate the increase in the cost of living?
a. Car makers benefit from a new technology that allows them to sell higher-quality cars to
consumers with no increase in price.
b. Energy prices decrease, and consumers respond by buying more gas and electricity.
c. A new good is introduced that renders cellular telephones inferior and obsolete.
d. All of the above are correct.
66. An increase in the price of bread produced domestically will be reflected in
a. both the GDP deflator and the consumer price index.
b. neither the GDP deflator nor the consumer price index.
c. the GDP deflator but not in the consumer price index.
d. the consumer price index but not in the GDP deflator.
67. Henri earned a salary of $50,000 in 2001 and $70,000 in 2006. The consumer price index was 177 in 2001
and 265.5 in 2006. Henri's 2001 salary in 2006 dollars is
a. $25,000.00.
b. $33,333.33.
c. $44,250.00
d. $75,000.00.
68. In 1970, Professor Plum earned $12,000; in 1980, he earned $24,000; and in 1990, he earned $36,000. If the
CPI was 40 in 1970, 60 in 1980, and 100 in 1990, then in real terms, Professor Plum's salary was highest in
a. 1980 and lowest in 1970.
b. 1980 and lowest in 1990.
1990 and lowest in 1970. Check answers here http://bit.ly/3cPUKd1
c.
d. 1990 and lowest in 1980.
Scenario 24-4
lOMoAR cPSD| 784381
Quinn has job offers in Wrexington and across the country in Charlieville. The Wrexington job would pay a
salary of $50,000 per year, and the Charlieville job would pay a salary of $40,000 per year. The CPI in
Wrexington is 150, and the CPI in Charlieville is 90.
69. Refer to Scenario 24-4. If Quinn only cares about maximizing her purchasing power, then she should
a. take the Charlieville job.
b. take the Wrexington job.
c. take either job because they both have the same purchasing power.
The answer cannot be determined from the information given because a salary is not the same as purchasing power.
Check answers here http://bit.ly/3cPUKd1
d.
70. Unemployment data are collected
a. from unemployment insurance claims.
b. through a regular survey of about 60,000 households.
c. through a regular survey of about 200,000 firms.
d. using all of the above.
71. Who of the following is not included in the Bureau of Labor Statistics' “employed” category?
a. those who worked in their own business
b. those who worked as unpaid workers in a family member's business
c. those waiting to be recalled to a job from which they had been laid off
d. those who were temporarily absent from work because of vacation.
72. Who is not included in the labor force by the Bureau of Labor Statistics?
a. Calvin, who is on temporary layoff
b. Michael, who has retired and is not looking for work
c. Lauren, who does not have a job, but has applied for several in the last week
d. None of the above is correct.
73. In June 2009 the BLS reported a U.S. foreign-born population of 35.3 million. Of these, 22.7 million were
employed and 1.4 million were unemployed. Based on these numbers what were the unemployment rate and
the labor-force participation rate of the foreign-born U.S. population?
a. 1.4/35.3 and 22.7/35.3
b. 1.4/35.3 and 24.1/35.3
c. 1.4/24.1 and 22.7/24.1
d. None of the above are correct.
Table 28-1
Labor Data for Aridia
Year
Adult population
Number of employed
Number of unemployed
2010
2000
1400
200
2011
3000
1300
600
2012
3200
1600
200
74. Refer to Table 28-1. The number of adults not in the labor force of Aridia in 2011 was
a. 600.
b. 1100.
c. 1700.
d. 2400.
lOMoAR cPSD| 784381
75. Refer to Table 28-1. The unemployment rate of Aridia in 2011 was
a. 20%.
b. 31.6%.
c. 46.2%.
d. 63.3%.
76. Refer to Table 28-1. The labor-force participation rate of Aridia in 2011 was
a. 43.3%.
b. 54.2%.
c. 63.3%.
d. 68.4%.
77. Which of the following is not correct?
a. Most people who become unemployed will soon find jobs.
b. In an ideal labor market, wages would adjust to ensure that all workers are always fully
employed.
c. The unemployment rate occasionally falls to zero.
d. There are always some workers without jobs, even when the overall economy is doing
well.
78. Frictional unemployment results from
a. job searching. It is often thought to explain relatively short spells of unemployment.
b. job searching. It is often thought to explain relatively long spells of unemployment
c. a surplus in the some labor markets. It is often thought to explain relatively short spells of
unemployment.
d. a surplus in some labor markets. It is often thought to explain relatively long spells of
unemployment.
79. Minimum-wage laws can keep wages
a. above equilibrium and cause a surplus of labor.
b. above equilibrium and cause a shortage of labor.
c. below equilibrium and cause a surplus of labor.
d. below equilibrium and cause a shortage of labor.
80. When a union raises the wage above the equilibrium level,
a. the quantity of labor supplied and unemployment both rise.
b. the quantity of labor supplied and unemployment both fall.
c. the quantity of labor supplied rises and unemployment falls.
d. the quantity of labor supplied falls and unemployment rises.
Short Answer Check answers here http://bit.ly/3cPUKd1
81.
a.
b.
What is the difference between a "change in supply" and a "change in quantity
supplied?" Graph your answer.
For each of the following changes, determine whether there will be a change in quantity
supplied or a change in supply.
i. a change in input costs
ii a change in producer expectations
iii. a change in price
iv. a change in technology
lOMoAR cPSD| 784381
v. a change in the number of sellers
82. GDP is defined as the market value of all final goods and services produced within a country in a given period
of time. In spite of this definition, some production is left out of GDP. Explain why some final goods and
services are not included.
83. The table below uses data for the year 2003 provided by the Bureau of Labor Statistics and adjusted to be
comparable to U.S. data. All values are in thousands. Fill in the blank entries in the table.
Country
Japan
France
Germany
Adult
Population
Labor
Force
109,474
70,159
26,870
39,591
Employed
Unemployed
62,510
3,500
2,577
Unemployment
Rate
Labor-Force
Participation
Rate
57.41
9.69
84. How does microeconomics relate to macroeconomics?
85. Recent decades have seen a trend toward globalization, which means that buying and selling in markets have
crossed national borders to an increasing extent. As a result, firms and workers from different countries are
increasingly interconnected. Globalization has occurred for a number of reasons. List three reasons and
briefly describe their effect contributing toward globalization.
86. The formal study of economics began when Adam Smith (1723-1790) published his famous book The Wealth
of Nations in 1776. In the first chapter of The Wealth of Nations, Smith introduces the idea of the division of
labor. Define "division of labor" and illustrate with an example.
Check answers here http://bit.ly/3cPUKd1
lOMoAR cPSD| 784381
Check answers here http://bit.ly/3cPUKd1