AP Macro MACRO: Measurement of Economic Performance 3

Question 1

Which of the following best describes the concept of 'value added' in computing GDP?

Accepted Answer

The difference between a firm's revenue and its purchases of intermediate goods

Answer

Value added equals each firm's sales revenue minus the cost of intermediate inputs, ensuring no double-counting in GDP.

Question 2

If a country's GDP is $500 billion and its population is 50 million, its GDP per capita is:

Accepted Answer

$10,000

Answer

$500 billion ÷ 50 million people = $10,000 per capita.

Question 3

Which unemployment type arises when workers search for jobs that match their skills, even in a healthy economy?

Accepted Answer

Frictional unemployment

Answer

Frictional unemployment results from normal job-search time as workers transition between positions.

Question 4

The labor force participation rate is calculated as:

Accepted Answer

(Labor force ÷ Working-age population) × 100

Answer

LFPR measures the share of the working-age population that is either employed or actively seeking work.

Question 5

Which of the following people would be classified as unemployed by the Bureau of Labor Statistics?

Accepted Answer

A person who lost a job last month and is actively applying for new ones

Answer

BLS defines unemployed as jobless, currently available, and actively searching — a recent job-loser applying for work fits exactly.

AP Practice Test