Started on Friday, 17 August 2018, 10:28 PM

State Finished
Completed on Friday, 17 August 2018, 11:00 PM
Time taken 31 mins 18 secs
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Mark 2.25 out of 3.75 (60%)
Question 1
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Cyclical unemployment is unemployment associated with:

Select one:

a. changes in the composition of aggregate demand

b. changes in technology or its usage

c. changes in the level of aggregate spending

d. inflation

e. changes in the actual rate of employment

f. people moving in and out of jobs

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The correct answer is: changes in the level of aggregate spending

Question 2
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Which of the following can increase economic growth?

Select one:
a. Increase in saving levels

b. Investment in research and development

c. Increase in international trade

d. Improvement in quality of education

e. Improvement in law and order

f. All of the above

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The correct answer is: All of the above

Question 3
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Which of the following does not represent investment?

Select one:

a. an increase in the quantity of shoes on the shelves of a shoe store

b. the construction of a house that will be occupied by its owner but used for business

c. the purchase of newly issued shares in Telstra

d. the construction of a factory building using money borrowed from a bank

e. all of the above

f. none of the above

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The correct answer is: an increase in the quantity of shoes on the shelves of a shoe store

Question 4
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In the circular flow of income

Select one:

a. only the goods markets are linked.

b. households demand goods and services that are supplied by firms, while supplying
factors that are demanded by firms.

c. households buy goods and services while firms sell goods and services. Firms obtain
labour from households, capital from government and raw materials from other firms.

d. households sell goods and services while firms sell factors.

e. households demand goods and services that are supplied by firms, and the firms
demand factors that are supplied by intermediate firms.

f. only the resource markets are interconnected.

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The correct answer is: households demand goods and services that are supplied by firms,
while supplying factors that are demanded by firms.

Question 5
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When a recession ends, the turning point that immediately follows is called a

Select one:

a. peak.

b. trough.

c. depression.

d. Boom
e. Expansion

f. None of the above answers is correct.

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The correct answer is: trough.

Question 6
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Which of the following is a perfect labour market indicator?

Select one:

a. unemployment rate

b. youth unemployment rate

c. employment-to-population ratio

d. male labour force participation rate

e. female labour force participation rate

f. none of the above

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The correct answer is: none of the above

Question 7
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The word "final" in the definition of GDP refers to

Select one:
a. valuing production at market prices.

b. not counting intermediate goods or services.

c. the input process.

d. counting the intermediate goods and services used to produce GDP.

e. the time period when production took place.

f. the final production process.

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The correct answer is: not counting intermediate goods or services.

Question 8
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Builders who are fired as a consequence of new technology would be classified as :

Select one:

a. frictionally unemployed

b. cyclically unemployed

c. periodic unemployed

d. structurally unemployed

e. hidden unemployed

f. all of the above

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The correct answer is: structurally unemployed

Question 9
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When estimating the value of GDP, the inclusion of the value of the flour used in
producing cake during the a given year would be an example of :

Select one:

a. including a non-market transaction

b. including a non-productive transaction

c. double counting

d. including a final product

e. including resources

f. including a market transaction

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The correct answer is: double counting

Question 10
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The service a baby-sitter performs when she stays home with baby brother while her
parents are out, and for which she receives no payment, is not included in the GDP
because :

Select one:

a. double counting would be involved

b. this is a non-investment transaction

c. this is a non-productive transaction

d. none of the above

e. this is a non-market transaction

f. this is a investment related transaction

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The correct answer is: this is a non-market transaction

Question 11
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You are told that real GDP has grown in the past year. From this information you are able
to conclude that there has been:

Select one:

a. an improvement in quality of goods and services produced

b. an increase in the number of people employed

c. an increase in capital productivity

d. an increase in labor productivity

e. an increase in distribution of income

f. none of the above

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The correct answer is: none of the above

Question 12
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The circular flow diagram shows

Select one:
a. the effects of unemployment in a close economy.

b. the flows between different sectors of the economy.

c. how the resource prices are determined.

d. how the prices of factors are determined.

e. how nominal GDP is distinct from real GDP.

f. the effects of inflation in a simple economy.

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The correct answer is: the flows between different sectors of the economy.

Question 13
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An expansion

Select one:

a. comes just before a trough.

b. is defined as a period of negative real GDP growth.

c. follows a peak.

d. follows a boom.

e. is defined as a period during which real GDP decreases.

f. is defined as a period during which real GDP increases.

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The correct answer is: is defined as a period during which real GDP increases.

Question 14
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Which of the following is NOT included in real GDP?

Select one:

a. Production of goods that last more than a year, such as a pair of rollerblades.

b. Production of goods that last less than a year, such as production of hot dogs.

c. Production of goods that are sold at lower prices.

d. Production of services, such as the services of hairdressers.

e. Production that takes place in the underground economy.

f. All of the above are correct.

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The correct answer is: Production that takes place in the underground economy.

Question 15
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When capital equipment is damaged in the production of each year’s goods and services,
it is called :

Select one:

a. indirect taxation

b. direct cost of capital

c. a drawing down of stocks

d. depreciation
e. gross capital formation

f. none of the above

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The correct answer is: depreciation