Question

5. Which of the following expenditures would be included in GDP for 2020?

Group of answer choices

b. The purchase of a new tire by Ford for one of the cars on the assembly line.

a. The purchase of a new Corvette last week.

d. All of these would be included.

c. The purchase by you of your neighbor’s Toyota Tacoma.

6. If the numbers of employed and unemployed do not change and added together equal 200 million but the size of the civilian population that equals 1,000 million people, suddenly increases by 15%, what would be the effect?

Group of answer choices

c. ​an increase in the unemployment rate and no change in the labor force participation rate

b. ​an increase in the unemployment rate and a decrease in the labor force participation rate

a. ​no change in the unemployment rate and a decrease in the labor force participation rate

d. ​an increase in the unemployment rate and an increase in the labor force participation rate

7. Suppose we shopped for a basket of goods in 1950 and it cost $350. Suppose the same basket of goods adds up to $385 in 2019. If we use 1950 as a base year, what would be the 2019 CPI?

Group of answer choices

c. 100.

d. 110.

a. 35.

b. 90.

​If the number of employed persons in Argentina equals 24 million, the number of unemployed persons equals 8 million, and the number of people over the age 16 in the population equals 40 million, the unemployment rate equals:

Group of answer choices

d. ​32 percent.

c. ​25 percent.

b. ​20 percent.

a. ​8 percent.

9. Which of the following statements is true?

Group of answer choices

a. In a world, where resources are used efficiently, having more of one good, like computers, necessarily means less of some other good, like wheat.

b. The law of increasing opportunity costs assumes that all people, especially entrepreneurs, have the same ability to produce all types of goods.

c. Efficiency implies that it is impossible to get more of one good, like ipods, without getting less of another good, such as computers.

d. a and c

Answer 1

1. The correct option is a. The purchase of a new Corvette last week.

This is because second hand sales are not counted in GDP, so C is out. Intermediate goods are also not counted in GDP, so B is also out. Only A remains as sale of final new goods is counted in GDP.

2. The correct option is A- no change in the unemployment rate and a decrease in the labor force participation rate

As the labor force is not changing (constant at 200 million), unemployment rate will not change. But since total population is increasing, and labor force participation rate is labor force/population, the labor force participation rate will decrease.

3. 385/350=1.1. In percentage terms it is 110%.So the CPI in 1985, with 1950 as base year, is 110. Hence, Option D-110 is correct.

4. The number of employed is 24 million, the number of unemployed is 8 million. So, total labor force=24+8=32million. We know that

Unemployment rate=number of unemployed/labor force. Unemployment rate is not counted for all who are above 16. it is only counted for those who are in labor force.

So,

unemployed rate=8/32=25%

Hence, option C-25% is correct.

5. The correct option is d. a and c.

This is because both of the statements A and C are correct. When resources are being used efficiently, then production cant be increased further without sacrificing one product over another.

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