WGU D089 LATEST EXAM PRINCIPLES OF
ECONOMICS EXAM QUESTIONS AND
CORRECT ANSWERS | LATEST VERSION |
ALREADY GRADED A+ | JUST RELEASED
What is the hypothetical level of unemployment the economy would
experience if aggregate production where in the long run state? ------
CORRECT ANSWER---------------The natural rate of unemployment
What is international trade? ------CORRECT ANSWER---------------The
exchange of capital, goods, and services across international borders or
territories
When should countries import goods? ------CORRECT ANSWER--------------
-If the opportunity cost of producing them abroad is lower than the
opportunity cost of producing them domestically.
What do firms that export have access to? ------CORRECT ANSWER--------
-------A broader market and the ability to take advantage of economies of
scale
What is the difference between the monetary value of exports and imports
in an economy over a certain period, measured in the currency of that
economy? ------CORRECT ANSWER---------------The balance of trade
,What do dollars used to purchase imports flow back into the country as? ---
---CORRECT ANSWER---------------Financial capital that is used to fund
investment and to purchase government debt.
What is the purpose of the World Trade Organization (WTO)? ------
CORRECT ANSWER---------------To facilitate trading worldwide, ensuring
that trade flows as smoothly, predictably, and freely as possible.
On the production possibilities curve, where would you find points that are
unattainable with existing resources and technology if trade does not occur
with an external producer? ------CORRECT ANSWER---------------Outside
the curve
When does a country have an absolute advantage? ------CORRECT
ANSWER---------------When it can produce a good more efficiently with
fewer resources
What attributes of a good or service are needed to be included in the GDP?
------CORRECT ANSWER---------------Must be a final good made within a
particular year, traded in a legal market, and made within the geographic
boundaries of the country.
What is the difference between nominal value and real value? ------
CORRECT ANSWER---------------Nominal value is the value in current
dollars where the real value is the nominal value after adjusting for changes
in inflation.
,What is the business cycle? ------CORRECT ANSWER---------------The
pattern of expansion and contraction of GDP.
What occurs when the GDP declines significantly? ------CORRECT
ANSWER---------------A recession
Why can GDP alone be a misleading indicator of a nations's wealth? ------
CORRECT ANSWER---------------Countries with large populations often
have large GDPs, a better measure is GDP per capita.
What is an approximate indicator of a society's standard of living? ------
CORRECT ANSWER---------------GDP
What two groups can the adult population be divided into? ------CORRECT
ANSWER---------------Those in the labor force and those out of the labor
force?
How can the labor force be divided? ------CORRECT ANSWER---------------
Employed and unemployed
What are the requirements of a person to be counted as unemployed and a
part of the work force? ------CORRECT ANSWER---------------The person
must be willing and able to work and actively looking for work to be
counted, otherwise a person without a job is counted as out of the labor
force
, How do economists define the unemployment rate? ------CORRECT
ANSWER---------------The number of unemployed persons divided by the
number of persons in the labor force
When does frictional unemployment occur? ------CORRECT ANSWER-------
--------When people either choose to change jobs, such as when a person
moves to a new city, or is a new college graduate.
When does structural unemployment occur? ------CORRECT ANSWER-----
----------When demand shifts permanently away from a certain type of job
skill, such as when jobs are outsourced or replaced by technology.
When does cyclical unemployment occur? ------CORRECT ANSWER--------
-------When there is a downturn in the economy, and it rises and falls with
the business cycle
How does the unemployment rate react to a recession? ------CORRECT
ANSWER---------------It rises
When the economy is strong, in what range is the unemployment rate? -----
-CORRECT ANSWER---------------Around 4% to 6%
Is the unemployment rate ever zero? ------CORRECT ANSWER---------------
No
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