GDP
Real GDP per capita = Real GDP/Population
Inflation is a general _______ in the prices of goods and services
Increase
What type of unemployment results from fluctuations in the business cycle?
Cyclical Unemployment
When calculating CPI, what is held constant?
What is an autarky?
A country that is not open to international trade
What is the formula for Real GDP?
Real GDP = Quantity of Output x Base Year Prices
Inflation decreases the ________ ________ of money
Purchasing power
What type of unemployment is occurs when the skills that some workers have to offer don't match the skills needed by the firms in the economy?
Structural Unemployment
Name four of the eight major groups of goods/services included in the consumer price index.
Any four of the following:
Food and Beverages, Housing, Apparel, Transportation, Medical Care, Recreation, Education and Communication, Other goods and services
What is a tax or fee that must be paid on goods that are imported from other countries?
When calculating Real GDP, what is held constant?
Prices (use base year prices)
Inflation Rate = ((CPInew-CPIold)/CPIold) x 100
To be considered unemployed, what two things must be true?
1. Not had a job for at least a week
2. Actively searched for employment in past 4 weeks
Year CPI
2011 97
2012 100
2013 103
2014 107
2012 (CPI in base year is always 100)
If quantity supplied is greater than quantity demanded, a country should _______
Export
To find nominal GDP, you add up 4 things. What are those four things?
C (Consumption) + I (Gross Investment) + G (Government Purchases) + NX (Net Exports)
Year CPI
1 95
2 100
3 114
14%
What is the unemployment rate formula?
Unemployment Rate = ((Unemployed)/Labor Force) x 100
What is the market basket value of 2001 if 2004 is the base year?
2001 2004
Quantity Price Quantity Price
Bread 300 $1.00 200 $1.50
Milk 400 $2.00 500 $3.00
Pasta 200 $2.25 400 $3.50
$2,100
Quotas only apply _______ the world price.
Year 1 Year 2
Item Price Quantity Price Quantity
Socks 15 10 16 12
Shoes 100 4 110 5
Shirts 30 12 30 15
$960
Based off the information below, what is the inflation rate for Year 2?
Year CPI
1 95
2 100
3 114
5.3%
A nation has 250 million people of working age. Currently, 142.5 million workers are employed in the nation, and 7.5 million are unemployed.
What is the size of the labor force?
What is the unemployment rate?
Unemployment Rate: 5%
If a market basket is made up of only three goods (bread, pasta, and milk) and the base year is 2003, what is the CPI for 2008?
2003 2008
Quantity Price Quantity Price
Bread 200 $1.50 400 $2.00
Milk 500 $3.00 300 $4.00
Pasta 400 $3.50 500 $5.00
137.5
If a tariff of $2 is placed on 128 imported vases, what is the tariff revenue?
$256