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Chapter-5
Definition
(1) Macroeconomics (2) CPI (3) Price level (4) Base year (5) Inflation (6) Real income (7)
Unemployment rate (8) Employment rate (9) Labor force participation rate (10) Discouraged
workers (11) Frictional unemployment (12) Structural unemployment (13) Natural rate of
unemployment (14) Frictional unemployment (15) Cyclical unemployment (16) Discouraged
workers (17) Full employment
Conceptual Questions
(18)Distiguish between macroeconomics and microeconomics? (19) What does
macroeconomics focus? PTPD
1.Macroeconimices Problems
2.Macroeconomics theories
3.Macroeconomices polices
4.Different view of how economics work,
(20) What are the macroeconomic problems?IIUL
Higher
1.Higher inflation rate
2.higher interest rate
3.higher unemployment rate
4.low economic growth
(21) What are the macroeconomic policies?FM
1. Fiscal policies: Fiscal policies deal with changes in government expenditure(cost) and taxes.
Exm:a proposal to cut taxes is fiscal policies measure.
2. Monetary policies: monetary policies deal with changes in money supply.
Exm: a proposal to decrease the rate of growth of the money supply is a monetary policies
measure.
(22) What are the macroeconomic organizational categories?
Three type Category:PSE
1.P-Q Category:
2.Self regulating economics instability category.
3.effective-ineffective category.
(23) What is fiscal policy?(look at 21) (24) What is monetary policy?(look at 21)
(25) What is the limitation of CPI?
A consumer price index (CPI) measures changes in the price level of a market basket of consumer
goodsand services purchased by households.
(26) Write down the formula for converting dollar from one year to another? (27) Who are
unemployed?
Unemployment occurs when people who are without work are actively seeking paid work
(28) What are the reasons for unemployment?
1.Job loser
2.Job leaver
3.re-entrant
4.new entrant
Chapter-6
Definition
(1) GDP
Gross Domistic Product:Value of final good and services produce within the border of the
country.
(2) (2) Final good (3 Intermediate good (4) Double counting (5) Per capita GDP (6)
Consumption (7) Investment (8) Inventory investment (9) Government purchases (10)
Government transfer payment (11) Net exports (12) depreciation (13) Statistical
discrepancy (14) NDP (15) Real GDP (16) Economic growth (17) Business cycle
Conceptual Questions
(16) What are the different measures for GDP?
Three approach in Measure:
1.Expenduture
2.Income
3.Value added
(17) What does GDP omit?
1. Govt transfer payments
2. Financial transactions
3.Share Market
4.Black Market
IUB Name:
MBA510
Quiz1 ID:
Time: 20 minutes
Answer any 10 questions
(1) Define CPI. What is the limitation of CPI? (2) Define inflation (3) What do you mean by
real income? (4) What do you mean by cyclical unemployment (5) What do you mean
by full employment (6) What do you mean by inventory investment? (7) What are the
reasons for unemployment? (8) What do you mean by real GDP? (9) ) What do you
mean by depreciation? (10) What do you mean by business cycle? (11) What are the
expenditures in a real world economy? (12) What does GDP omit? (13) What are the
components of consumption expenditure? (14) What are the different measures for
GDP? (15) What are the components of national income?
Why does GDP omit some non market goods and services? Give an example.
sometimes people don't get paid for their goods and services so the value of their goods
and services can not be counted into the GDP (ex: a family member cooks, cleans, and
mows the lawn for their family)
Why does GDP omits the sales of used goods? Give an example
.
if you buy something used it doesn't enter into the current years statistics because the car
was counted when it was originally produced
(ex: someone buys a used car)
Why does GDP omit stock transactions and other financial transactions? Give an
example.
GDP is a record of goods and services produced annually in an economy; a person who
buys stock is not buying a product but they are buying an ownership of a company
(ex: someone buys 100 shares of stock in a company)
Why does GDP omit government transfer payments? Give an example.
when the government makes payments to someone, it often does not get a good or
service in exchange
(ex: someone receives a social security check)
GNP measures the total market value of final goods and services produced by US
citizens, no matter where in the world they reside; GDP is the total market value of final
goods and services produced within the boarders of the United States, no matter who
produces them. So GDP only applies inside the boarder of the U.S. while GNP can apply
worldwide.