Which of the following actions would not increase GDP? Tom gets fired for being

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Which of the following actions would not increase GDP? Tom gets fired for being late so often after his alarm clock breaks, so he moves off to the wilderness. Tom's alarm clock breaks; now he oversleeps long enough that he buys a cup of coffee on the way to work instead of making it for himself at home. Tom buys a new alarm clock because he routinely sleeps through the first alarm. Tom sells his broken alarm clock and uses the revenue to buy some French fries. Tom's alarm clock breaks, so he buys a new one. Cyclical unemployment results from being in the wrong geographical location a recession in the economy taking the time to find the best job a mismatch of skills seasonal decreases in demand for labor Net exports is the value of exports plus the value of imports minus depreciation imports minus tariffs exports minus tariffs imports minus the value of exports exports minus the value of imports The consumer price index measures changes in the prices of goods that are sold the prices of all goods and services the total costs of goods and services purchased by firms the total costs of all goods and services the total cost of a specific market basket of consumer goods and services Gross Domestic Product equals the market value of all final goods and services produced by resources located in the U.S. value of total sales of goods and services produced in the U.S. value added to the economy by intermediate goods and services minus original cost total output of all goods and services produced by resources located in the U.S. market value of all goods and services produced by resources located in the U.S. Which of the following people would be classified as unemployed'? someone who gives up looking for a job a person who works at a job that underemploys his or her skills a person who works part-time and would rather work full-time a person who wants a job as a fashion model but cannot find work in that field someone who quits a part-time job to attend school full-time A recession is best defined as a period during which employment, output, and income decline the percentage of the population employed is declining the price level is declining the budget deficit and trade deficit are both growing more resources are used Which of the following is the best example of an intermediate good or service? a professional performance of "The Phantom of the Opera" pizzas bought at a restaurant legal services hired by a public accounting firm sunglasses worn on a summer vacation in Florida any good bought by a household, rather than a firm A discouraged worker is one who is overqualified for his current job is underqualified for his current job dislikes his current job but is afraid to quit quits his job because the possibility of advancement was very low drops out of the labor force because he cannot find a job The value of the films produced in the United States starring Charlie Chaplin that still exist will not be included in this year's U.S. GDP because the films are no longer being shown and earning revenue Charlie Chaplin did not make the films this year the films no longer have any value except for collectors films are intermediate goods Charlie Chaplin was not an American citizen In order to convert nominal GDP to real GDP. we must divide nominal GDP by the price index real GDP by the price index the price index by nominal GDP nominal GDP by real GDP the price index by real GDP Juanita earned a B.S. in engineering and went to work for a defense contractor. When the government cut spending. Juanita and 99 others were laid off. The only other business in the town is growing grapes, but the growers refuse to hire 1 aid-off engineers, knowing they will leave at the first opportunity. The unemployment Juanita is experiencing is frictional seasonal cyclical structural voluntary Inflation is a general and continuing rise in the money prices of goods and services an increase in the value of money compared to the value of goods a reduction in everyone's standard of living a rise in the real prices of all goods and services a continuing rise in everyone's standard of living Which of the following would not be included in GDP as government purchases? The state government buys computer time. The state government funds a state university. The local township repairs the roads. The federal government pays a lawyer as a public defender. The federal government sends out Social Security checks.

Explanation / Answer

7. a.

(Tom neither buys nor sells, just moves off)

8. e.

(It results from business not having enough demand for labor)

9. e.

(the difference between exports and imports could be positive or negative)

10. e.

(the cost of basket of goods and services compared overtime)

11. e.

(GDP represents the monetary value of all goods and services produced within a nation's geographic borders over a specified period of time)

12. d.

13. a.

(declining nominal GDP)

14. c.

15. e.

(discouraged workers are unemployed people that were looking for work but have given up)

16. b.

17. a.

( Nominal GDP is divided by the GDP deflator (price index) to get Real GDP)

18. c.

(workers who experience unemployment due to a lay off as a result of a recession illustrate a classic case of cyclical unemployment)

19. a.

20. d.

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