Question: When is the output gap negative?

Answer: When Potential GDP > Real GDP

Question: A measure of both the incomes and expenditures of an economy is?

Answer: Gross Domestic Product

Question: The calculation for the GDP deflator is?

Answer: (Nominal GDP/Real GDP) x 100

Question: The three factors of production include?

Answer: Land, Labor, Capital

Question: What is the indicator of the maximum quantity of goods that can be efficiently produced by an economy?

Answer: Production Possibilites Frontier

Question: The __________ means that the total income must equal the total expenditure.

Answer: Equilibrium

Question: The fluctuations in output, employment, financial conditions, and prices are called?

Answer: Business Cycle

Question: What is the percentage change in the overall level of prices from one year to the next?

Answer: Inflation Rate

Question: Which of the following is not one of the basic models that economists use to explain how a complex, real world works?

1. The Circular Flow Diagram

2. b. The Business Cycles Model

3. c. Consumer Price Basket

4. d. The Production Possibility Frontier

5. Answer: Consumer Price Basket

6. Question: What is the market value of all final goods and services produced within a country in a given period of time?

7. Answer: Gross Domestic Product