ECON TEST 2REVIEW NEWEST ACTUAL EXAM WITH COMPLETE
QUESTIONS AND CORRECT VERIFIED ANSWERS (DETAILED
ANSWERS) ALREADY GRADED A+ 100%
Which of the following statements BEST describes the law of demand?
a) Price and quantity supplied are directly correlated
b) Demand and supply are linearly correlated
c) Demand and supply are not correlated
d) Price and quantity demanded are linearly correlated
e) Price and quantity demanded are inversely correlated - <<ANSWER>>e) Price and
quantity demanded are inversely correlated
Goods that are used as inputs in the production of other goods are called
a) final goods
b) capital goods
c) supplementary goods
d) complementary goods
e) intermediate goods - <<ANSWER>>e) intermediate goods
The property of money that causes it to have no effect on real values is called the
a) neutrality of money
b) nominal value
c) liquidity of money
d) real value independence
e) velocity of money - <<ANSWER>>a) neutrality of money
Which government organization calculated CPI?
a) Department of Treasury
b) Bureau of Labor Statistic
c) Consumer Prices Agency
d) The Federal Reserve
e) The National Bank - <<ANSWER>>b) Bureau of Labor Statistic
,When are capital goods included in the GDP calculation?
The year they are retired.
a) The year they are retired.
b) The year they are produced.
c) They are never counted.
d) Each year they are resold.
e) Each year they are in use. - <<ANSWER>>b) The year they are produced.
An old house is sold for $300,000. The real estate agent makes a 10% commission on
the sale. What is the increase in GDP due to this transaction?
a) $30,000
b) $330,000
c) $300,000
d) $3,000
e) $303,000 - <<ANSWER>>a) $30,000
Which of the following expenditures would NOT be classified as investment spending?
a) unsold inventory produced
b) buying new capital
c) real estate purchases
d) money spent on bonds
e) buying an old house - <<ANSWER>>d) money spent on bonds
The creation of plastic is best classified as a
a) product innovation
b) total innovation
c) synthetic innovation
d) process innovation
e) organic innovation - <<ANSWER>>a) product innovation
Campos was laid off six months ago and has not sought work since. He is considered to
be
a) cyclically unemployed
b) frictionally unemployed
c) out of the labor force
d) seasonally unemployed
e) structurally unemployed - <<ANSWER>>c) out of the labor force
In 1820, what percent of the world population had an income below $1.90 per day?
a) 80%
, b) 50%
c) 90%
d) 70%
e) 60% - <<ANSWER>>c) 90%
Which term relates to the increase in research and development that cities cause?
a) urban boost
b) agglomeration benefit
c) collection effect
d) urban investment
e) collection benefit - <<ANSWER>>b) agglomeration benefit
Which of the following technologies would be MOST likely to have network effects?
a) typewriters
b) airplanes
c) telephones
d) light bulbs
e) capital tools - <<ANSWER>>c) telephones
Which economist famously argued that for progress to occur, people first had to believe
it was possible?
a) Joseph Schumpeter
b) Joel Mokyr
c) Dierdre McCloskey
d) Paul Romer
e) Robert Solow - <<ANSWER>>b) Joel Mokyr
A worker is fired from their job in an economic downturn. They are considered to be
a) cyclically unemployed
b) structurally unemployed
c) seasonally unemployed
d) out of the labor force
e) frictionally unemployed - <<ANSWER>>a) cyclically unemployed
Which of the following statements BEST exemplifies knowledge spillover?
a) Landlines are rendered obsolete by cell phones.
b) A large fraction of the public adopts a new technology.
c) An invention is copied by a rival company.
d) A computer is used to create a new invention.
e) A new smartboard is used in educational settings. - <<ANSWER>>d) A computer is
used to create a new invention.
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