Question

A) Why don’t economists, in the aggregate, advocate the use of price controls as means of governing prices in the short term (in other words, what do price controls in reality do that’s adversary)? (1) Answer:

1.Which of the following would be included in the US GDP: (1)

a.Clean up after fires caused by storms

b.Depositing checks at the local bank

c.A Chinese firm building train cars in Springfield, MA

d.Dividends earned on a preferred Amazon stock

e.An estate sale in a big city

f.B & D

g.C & D

h.All of the above

2. Full Employment exists only when: (1)

a. The UR is below 4.5%

b. Structural Unemployment is at zero

c. The UR is zero

d. When the percentage of the labor force which is employed is at 95.5% or higher

e. A & B

f. A & D

g.All of the above

3.Which of the following is not a public good? (1

) a. National Defense

b. Mall of America

c. Boston City Hall

d. Gillette Stadium

e. A & B

f. B & D

4. If the GDP is at 7.1% growth and the RGDP is at 2.2% growth, then what is the inflation rate? (1) Answer:

5. If the RGDP is at 4.3 growth and inflation is at 1.9%, then what is the GDP rate? (1) Answer:

6. If the inflation is at -.3% and the GDP is at 2.6%, then what is the RGDP change? (1) Answer:

7.If median weekly earnings were $859 at a time when one receives a raise of 2.5% that coincides with inflation rate of 1.7%, then a) how much does one’s paycheck increase by? And b) what is the real earnings increase? (1)

Answer 1

Question 1.

b.Depositing checks at the local bank

The reason being this leads to an income generation

Question 2

b. Structural Unemployment is at zero

Reason being in Unemployment rate, there are people who are willingly out and not doing work, hence it is not a good measure. wHILE STRUCTURAL UNEMPLOYMENT ONLY TAKES INTO ACCOUNT the people who want a job but are not getting one.

Question 3

d. Gillette Stadium

The reason being it is owned by Gillette.

Question 4

Inflation Rate= GDP/RGDP= 7.7/2.1= 3.67%