Question : 31) GDP can be represented by the equation: GDP = : 1384422

31) GDP can be represented by the equation: GDP = F × (Fe/F) × (GDP/Fe). This equation tells us that real aggregate output can be expressed as factor

A) price times the utilization rate times GDP per capita.

B) supply times the equilibrium factor price times GDP per capita.

C) supply times equilibrium factor price times factor productivity.

D) supply times the factor-utilization rate times factor productivity.

E) utilization times equilibrium factor price times factor productivity.

32) GDP can be represented by the equation: GDP = F × (Fe/F) × (GDP/Fe). This equation tells us that any change in real GDP can be decomposed into changes in

A) factor price, productivity and the investment rate by businesses.

B) factor price, productivity and factor-utilization rates.

C) factor supply, productivity and per capita consumption by households.

D) factor supply, productivity and the investment rate by businesses.

E) factor supply, productivity and factor-utilization rates.

33) Consider the equation: GDP = L × [E/L] × [GDP/E] where L is the supply of labour and E is the level of employment. In this equation, the term [E/L] represents the

A) productivity of labour.

B) the ratio of the population unemployed.

C) labour employment rate.

D) number of people employed.

E) capital-utilization rate.

34) Changes in factor-utilization rates are considered important for explaining short-run changes in real GDP because

A) wages increase and decrease rapidly in the short run, dampening the effect of factor utilization.

B) the employment ratio of labour and the amount of excess capacity respond quickly to changes in aggregate demand or supply.

C) additions to the labour force occur more frequently than changes in the utilization rate.

D) changes to the capital stock are almost impossible to make in the short run.

E) land and capital can change only in the short run.

35) When accounting for changes in real GDP, changes in the factor-utilization rate are most important in the

A) long run because firms need time to hire more workers or acquire additional capital.

B) long run because firms adapt to wage changes and hire more workers.

C) short run because firms react to changes in demand by increasing production from existing facilities.

D) short run because firms immediately build new plants to satisfy changes in demand.

E) short run because firms need time to adjust their price lists.

36) A low factor-utilization rate describes ________ in factor markets, which causes factor prices to ________ and shifts the aggregate supply curve to the ________.

A) excess supply; fall; left

B) excess demand; rise; right

C) excess supply; rise; right

D) excess demand; fall; right

E) excess supply; fall; right

37) An estimate for the value of potential GDP can be generated by observing and recording

A) the economy’s total supply of factors, their normal rates of utilization, and factor productivity.

B) the economy’s total supply of factors, the costs of those factors, and their productivity.

C) the economy’s total output, its total cost and demand for that output.

D) the total available capacity for production in the Canadian economy.

E) the level of actual GDP when the unemployment rate is zero.

38) Since 1985, Canada’s potential GDP has been

A) rising steadily.

B) falling steadily.

C) relatively stable.

D) volatile, but with an upward trend.

E) volatile, but with a downward trend.

39) Consider the equation GDP = F × (FE/F) × (GDP/FE). Which component describes the amount of output produced per unit of input employed?

A) F

B) FE

C) (FE/F)

D) (GDP/FE)

E) GDP

40) Consider the equation GDP = F × (FE/F) × (GDP/FE). Which component describes the fraction of the available factors actually employed at any time?

A) F

B) FE

C) (FE/F)

D) (GDP/FE)

E) GDP