1. What would be the consequence of depreciation being greater than gross investment?
a. The difference between GDP and NDP is smaller than gross investment.
b. Gross investment is negative c. Net investment exceeds depreciation d. The nation’s capital stock is being depleted
2. Mrozinskistan has a population of 50 million people. Of the 50 million people, 40 million are in the labor force and 36 million of them are employed. There are 2 million people who are classified as unable to work and 1 million people are unwilling to work.
What is the unemployment rate in Mrozinskistan?
a. 72%
b. 10.0%
c. 80.0%
d. 8.0%
3. Suppose that the United Republic of Trumpistan has a population of 1 billion people and 75% of them are in the labor force, whilst 90 million are unemployed. If we assume that full employment occurs at an unemployment rate of 2%, what would be the unemployment rate of the United Republic of Trumpistan?
a. 8.3%
b. 12.0%
c. 25.0%
d. 9.0%
3. Which of the following are left out when the core inflation rate is calculated?
a. Entertainment and packaging prices
b. Food and energy prices c. Only energy prices for the airlines d. Import prices
4. If unusually high inflation were to occur, which of the following would be a macro consequence?
a. Nominal income falls by a smaller percentage than real income b. People on fixed income benefits c. People lengthen their time horizons
d. Uncertainty is greater