Question

Q66. The three approaches to measuring GDP are called the

A) Accounting approach, the income approach, and the expenditure approach.

B) Product approach, the income approach, and the expenditure approach.

C) Product approach, the cost approach, and the expenditure approach.

D) Accounting approach, the statistical approach, and the income approach.

Q67. Assume that, in the population, 388 million people worked for pay last week, 12 million people did not work for pay but had been seeking a job, 5 million people did not work for pay and had not been seeking a job for the past several months, and 45 million were under age 15. The unemployment rate, given these numbers, is---------------------------

Q73. the price is 3, the quantity demanded is 8. When the price is 6, the quantity demanded is 4. What is the price elasticity of When demand?      -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Q68. If the CPI in year 2 equals 210 and the CPI in year 3 equals 221, it can be concluded that consumer prices. The inflation rate rose from year 2 to year 3 by ---------------------------------------------------------------------------------------------------

Q69. The Classical economists argued that:

a. a market economy will not experience unemployment.            b. if unemployment occurs wages and prices will fluctuate.

c. if inflation occurs it will cure itself because prices, wages, and interest rates will rise.   d. aggregate expenditures may be too low.

Answer 1

Q66. B) Product approach, the income approach, and the expenditure approach.
(These are the three approaches to measuring GDP.)

Q67. 3%
Unemployed = 12 million
Labor force = Unemployed+Employed = 12+388 = 400
Unemployment rate = (Unemployed/Labor force)*100 = (12/400)*100 = 3%

Q73. -1
Price elasticity of demand =

Q68. 5.24%
Inflation rate = [(CPI in year 3-CPI in year 2)/CPI in year 2]*100 = [(221-210)/210]*100 = (11/210)*100 = 5.24%

Q69. b. if unemployment occurs wages and prices will fluctuate.
(Classical economists believe that in case of unemployment, wages and prices will fluctuate so that full employment equilibrium is restored.)