Hardest Questions from test 2

pdf

School

McMaster University *

*We aren’t endorsed by this school

Course

1BB3

Subject

Economics

Date

Feb 20, 2024

Type

pdf

Pages

Uploaded by MagistrateRose25950

Hardest Questions from test 2 1. In 2021, "Hair by Kayla", a hair salon, spent $1000 on a new hair-styling chair, $2000 on a new computer system, and $10,000 on stocks and bonds issued by Estee Lauder (a beauty supply company). Unsold hair care products were valued at $1000 on January 1, 2021, and $2500 on December 31, 2021. What is "Hair by Kayla’s” total investment spending in 2021? A) $2500 B) $3000 C) $4500 D) $14500 Total investment includes actual investment and change in inventories $1000 chair $2000 computer $1500 (Change in inventories) 2. Refer to the Table. Assume the market basket for the consumer price index has two products — meat and potatoes — with the above values in 2002 and 2014 for price and quantity. The Consumer Price Index for 2014 equals A) 137. B) 141. C) 129. D) 125. CPI= current year/ base year Basket is fixed (Only take into account prices) CPI= (11.5x100) + (3 x 200)/ (100x10) + (2 x 200) CPI= 1150 +600 / 1000 +400 CPI= 1750/ 1400

CPI= 125 3. There are three identical houses on a street in Hamilton that were all built in 2016. In 2022, House A rents for $2000 per month. House B is occupied by a couple who had a small down payment and have a mortgage payment of $2500 per month. House C was purchased by a lottery winner who had a large down payment and therefore has a mortgage payment of only $500 per month. How much does House C contribute to the consumption component of GDP in July, 2022? A) $0 B $2000 C) $500 D) $2500 Imputed rental value 4. Which of the following will increase investment spending in the economy, holding everything else constant? A) an increase in transfer payments B) an increase in the federal government surplus C) an increase in the budget deficit D) an increase in consumer dissavings Increase in transfer payments cancels out Increase in budget deficit creates a shift to the left of the supply curve Consumer spending rise causes supply curve to shift to the left 5. Stefano is a Moroccan citizen working for an Italian- owned shoe factory located in France. The shoes produced by Stefano sell for 100 euros. What is the value of this output that is included in France's gross national income? A) zero B) less than 100 euros C) 100 euros

D) more than 100 euros 6. Suppose that Canada eliminates the Employment Insurance (EI) program. Which of the following statements is correct? A) Firms know that workers will be desperate for work, so the labour demand curve shifts out to the right. B) The opportunity cost of working increases and the labour supply curve shifts out to the right. C) The opportunity cost of working decreases and the labour supply curve shifts out to the right. D) There is no impact on the labour supply or labour demand curve. 7. Which of the following is not an example of inflation causing a redistribution of income because the inflation was unanticipated? A) A firm signs a 3-year contract with a union based on a 2 percent anticipated rate of inflation per year, and the actual rate of inflation ends up being 7 percent per year. B) Firms have to hire an extra worker to change prices in its store because of inflation. C) A bank collects a lower amount of interest from a loan because inflation was underpredicted. D) A worker receives a raise in salary that is less than the rate of inflation because management underpredicted inflation 8. What is the employment rate? A) the fraction of the labour force that is employed B) the fraction of all people over the age of 14 that is employed C) the fraction of the civilian, non-institutional, adult population that is employed D) the fraction of all people over the age of 18 that is employed

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

9. Rose’s salary last year was $58,000. After doing some research and careful bookkeeping, Rose discovers that she can purchase 1% more goods and services than last year and that the inflation rate during the year was 3%. What is Rose’s current salary? A) $59,740 B) $59,160 C) $58,580 D) $60,320 Review week 5 video 6 10. The size of the underground economy would tend to increase if the government of a country A) decreased government regulations on businesses. B) increased income tax rates. C) legalized prostitution. D) decreased sales taxes. 11. According to the text, economists consider full employment to occur when A) everyone who wants a job has a job. B) frictional unemployment equals zero. C) the sum of frictional unemployment and structural unemployment equals zero. D) the unemployment rate consists of only frictional and structural unemployment.

Related Documents

Econ 1034 - MIDTERM M_C.pdf

PBHE 315_Week 7_1.png

5.docx

4.docx

Raising the Rate of Minimum Wage.docx

3.docx

2.docx

Tutorial Week 5.pdf

TYLERGRAYMARK4350_Exam.1.Part.1_Spring.2021.docx

Finance Final.docx

Supply Chain Homework No 4 (002703664).pdf

Homework 1.xlsx

Recommended textbooks for you

Microeconomics A Contemporary Intro

Economics

ISBN:9781285635101

Author:MCEACHERN

Publisher:Cengage

Exploring Economics

Economics

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:SAGE Publications, Inc

Principles of Economics 2e

Economics

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:OpenStax

Essentials of Economics (MindTap Course List)

Economics

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:Cengage Learning

Brief Principles of Macroeconomics (MindTap Cours...

Economics

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:Cengage Learning

Economics:

Economics

ISBN:9781285859460

Author:BOYES, William

Publisher:Cengage Learning

SEE MORE TEXTBOOKS

Recommended textbooks for you

Microeconomics A Contemporary Intro
Economics
ISBN:9781285635101
Author:MCEACHERN
Publisher:Cengage
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc
Principles of Economics 2e
Economics
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:OpenStax
Essentials of Economics (MindTap Course List)
Economics
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours...
Economics
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Economics:
Economics
ISBN:9781285859460
Author:BOYES, William
Publisher:Cengage Learning