Question

1.Nominal gross domestic product (GDP) is a poor measure of economic growth because it

Group of answer choices

does not consider changes in prices or population growth.

overstates the importance of consumer spending.

does not count investment by private businesses.

does not include government spending.

ignores imports and exports.

2.The percent change in real per capita gross domestic product (GDP) equals the

Group of answer choices

percent change in nominal GDP.

percent change in nominal GDP minus the rate of population growth.

rate of population growth minus the percent change in prices.

percent change in nominal GDP minus the rate of population growth minus the percent change in prices.

rate of population growth.

3.Access to lifesaving medicine is very limited in parts of Africa; as a result, over 10 percent of children do not reach the age of five. What effect would an increase in medical aid to African children have on overall economic growth for the continent?

Group of answer choices

Economic growth would increase because more children would survive, which represents a technological advance.

Economic growth would not be affected; medical aid does not contribute to gross domestic product (GDP).

Economic growth would increase because the health and productivity of the labor supply would increase.

Economic growth would decrease because there would be more people to feed but no additional resources.

Economic growth would not be affected because children do not contribute to economic growth.

4.Access to lifesaving medicine is very limited in parts of Africa; as a result, over 10 percent of children do not reach the age of five. What effect would this have on economic growth in Africa?

Group of answer choices

It would slow economic growth because worker health and labor productivity would grow more slowly.

It would have no effect on economic growth because children do not contribute to economic growth.

It would increase economic growth because more money would be spent on medical research.

It would have no effect on economic growth because adults are less susceptible to illness.

It would slow economic growth because fewer adults would be employed as teachers.

5.The phase of the business cycle where economic activity is decreasing is called

Group of answer choices

an economic contraction.

an economic trough.

an economic peak.

the long-run trend of gross domestic product (GDP).

an economic expansion.

6.What is the consumer price index (CPI)?

Group of answer choices

The CPI is a measure of all prices in the economy.

The CPI is a measure of food, clothing, and housing prices.

The CPI is a measure of the price level based on the consumption patterns of a typical consumer.

The CPI is a measure of food prices, because food is what is consumed.

The CPI is the measure of consumer prices in both rural and urban areas. It is calculated by adding up all prices.

Answer 1

1 - Option A

Does not consider changes in price or population growth

The nominal GDP does not include the rate of inflation which makes it a bad measure to measure the growth. The real GDP is better measure. Hence Option A will be correct

2 - Option D

Percent change in nominal GDP minus growth rate of population minus change in prices.

The other options are not the correct formula for perc change in real GDP per capita

3 - Option C

Economic growth would increase because the health and productivity of labor supply will rise

This will lead to greater ability to produce the goods and hence GDP and economy will grow

4 - Option A.

It would slow economic growth because worker health and labor productivity will grow more slowly.

The productivity will not increase but have adverse effect on economy.

5 - Option A

An economic contraction

Expansion is the phase of rising of growth , peak is highest level of expansion , trough is where the growth is negative and is lowest phase of cycle.

6 - Option C

CPI is a measure of price level based upon the consumption patterns of consumer

It takes the price of fixed basket of goods and services. It is for the urban consumers. Hence option C will be correct