ECON 2 – macro

29 February 2024
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21 test answers
question
__________ implies that pressure for price increases reaches across _______________markets, not just one.
answer
Inflation; most
question
The effects of inflation are seen in:
answer
goods, services, wages and income levels.
question
Inflation implies that price levels _____________________.
answer
increase.
question
Inflation can be calculated in terms of how the overall cost of ___________________ changes over time.
answer
the basket of goods
question
The most commonly cited measure of inflation in the United States is:
answer
the Consumer Price Index (CPI).
question
One of the reasons that a rise in the price of a fixed basket of goods over time tends to overstate the rise in a consumer's true cost of living, is:
answer
substitution bias.
question
The percentage change in the price level from one time period to the next, whether the price level is measured in terms of money or as a price index, will be the _____________.
answer
inflation rate.
question
When we want to measure wage inflation in the labor market, we use the:
answer
Employment Cost Index.
question
The Producer Price Index is based on prices paid for supplies and inputs by:
answer
producers of goods and services.
question
The ____________________ is based on the prices of merchandise that are exported or imported.
answer
International Price Index
question
In the early 1990's extremely high inflation rates of 2500% were common in Russia. This situation would be referred to as ___________________.
answer
hyperinflation.
question
The situation where the buying power of money in terms of goods and services increases is called:
answer
deflation.
question
Which of the following is the name used to describe the price index that consists of intermediate goods and finished goods?
answer
Producer Price Index
question
The GDP deflator is a price index that includes the following components of GDP:
answer
Consumption, Investment, Government plus Exports minus Imports.
question
With regards to the economy, the term negative inflation is synonymous with which of the following?
answer
deflation
question
What distinguishes the real value of a statistic from the nominal value of a statistic?
answer
adjusting for inflation
question
When a price, wage, or interest rate is adjusted automatically with inflation, it is said to be __________.
answer
indexed.
question
In the 1970s and 1980s, labor unions commonly negotiated wage contracts that had _______________________ which guaranteed that their wages would keep up with inflation.
answer
cost of living adjustments
question
The effect of substitution bias is that the rise in the price of a fixed basket of goods over time tends to ___________________ the rise in a consumer's true cost of living, because it doesn't take into account that the person can substitute between goods according to changes in their relative prices.
answer
overstate
question
The __________________ is the nominal interest rate minus the rate of inflation.
answer
real interest rate
question
A payment is said to be ________________ if it is automatically adjusted for inflation.
answer
indexed
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question
__________ implies that pressure for price increases reaches across _______________markets, not just one.
answer
Inflation; most
question
The effects of inflation are seen in:
answer
goods, services, wages and income levels.
question
Inflation implies that price levels _____________________.
answer
increase.
question
Inflation can be calculated in terms of how the overall cost of ___________________ changes over time.
answer
the basket of goods
question
The most commonly cited measure of inflation in the United States is:
answer
the Consumer Price Index (CPI).
question
One of the reasons that a rise in the price of a fixed basket of goods over time tends to overstate the rise in a consumer's true cost of living, is:
answer
substitution bias.
question
The percentage change in the price level from one time period to the next, whether the price level is measured in terms of money or as a price index, will be the _____________.
answer
inflation rate.
question
When we want to measure wage inflation in the labor market, we use the:
answer
Employment Cost Index.
question
The Producer Price Index is based on prices paid for supplies and inputs by:
answer
producers of goods and services.
question
The ____________________ is based on the prices of merchandise that are exported or imported.
answer
International Price Index
question
In the early 1990's extremely high inflation rates of 2500% were common in Russia. This situation would be referred to as ___________________.
answer
hyperinflation.
question
The situation where the buying power of money in terms of goods and services increases is called:
answer
deflation.
question
Which of the following is the name used to describe the price index that consists of intermediate goods and finished goods?
answer
Producer Price Index
question
The GDP deflator is a price index that includes the following components of GDP:
answer
Consumption, Investment, Government plus Exports minus Imports.
question
With regards to the economy, the term negative inflation is synonymous with which of the following?
answer
deflation
question
What distinguishes the real value of a statistic from the nominal value of a statistic?
answer
adjusting for inflation
question
When a price, wage, or interest rate is adjusted automatically with inflation, it is said to be __________.
answer
indexed.
question
In the 1970s and 1980s, labor unions commonly negotiated wage contracts that had _______________________ which guaranteed that their wages would keep up with inflation.
answer
cost of living adjustments
question
The effect of substitution bias is that the rise in the price of a fixed basket of goods over time tends to ___________________ the rise in a consumer's true cost of living, because it doesn't take into account that the person can substitute between goods according to changes in their relative prices.
answer
overstate
question
The __________________ is the nominal interest rate minus the rate of inflation.
answer
real interest rate
question
A payment is said to be ________________ if it is automatically adjusted for inflation.
answer
indexed