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ECON1020 - 2012 MCQ set

Terms in this set (85)

If an Australian firm produces televisions in Taiwan, that production should count towards

• Australia's GNP.
• Australia's GDP.
• Taiwan's GNP.
• It will not affect either Australia's GNP or Australia's GDP
Australia's GNP.
Under the Bretton Woods system, central banks were committed to buying and selling ________ in exchange for ________.

• US dollars; gold
• gold; US dollars
• gold; their own currencies
• US dollars; their own currencies
US dollars; their own currencies
If nominal GDP rises we can say that

• production has fallen and prices have risen.

• production has risen or prices have risen or both have risen.

• production has risen and prices remain constant.

• prices have risen and production remains constant.
production has risen or prices have risen or both have risen.
Which of the following is NOT a reason why the Australian economy has generally been more stable since 1960?

• Services have become a larger fraction of GDP and goods have become a smaller fraction of GDP.

• Unemployment benefits and other government programs curtail the decline in spending that occurs during a recession.

• Goods have become a larger fraction of GDP and services have become a smaller fraction of GDP.

• The government has actively pursued economic policy to combat recessions and prolong expansions.
Goods have become a larger fraction of GDP and services have become a smaller fraction of GDP.
Which of the following scenarios could create cost-push inflation?

• A large increase in government expenditure.
• A large increase in the money supply.
• A large increase in energy prices.
• A large decrease in interest rates.
A large increase in energy prices
If S = national saving, G = government spending, I = private investment and NFI = net foreign investments, then

• S - I = NFI.
• S = G + NFI.
• S + G + NFI = I.
• S = G — NFI.
S - I = NFI.
Disposable income is defined as

• national income + transfers + taxes.
• national income - transfers - taxes.
• national income + transfers - taxes.
• national income - transfers + taxes.
national income + transfers - taxes.
The unemployment rate is calculated by

• dividing the number of unemployed people by the number of working individuals, and multiplying by 100.

• dividing the number of unemployed people by the number of people in the labour force, and dividing by 100.

• dividing the number of unemployed people by the sum of the number of working people plus the number of unemployed people, and multiplying by 100.

• dividing the number of unemployed people by the number in the working-age population, and multiplying by 100.
dividing the number of unemployed people by the sum of the number of working people plus the number of unemployed people, and multiplying by 100.
Which of the following is NOT included in the financial account of the BOP?

• Increase in private Australian asset holdings in foreign countries

• Increase in foreign private asset holdings in Australia

• Increase in foreign government asset holdings in foreign countries

• Income received on investments
Income received on investments
Which of the following is a reason why increases in the price level results in a decline in aggregate expenditure?

• Price level increases in Australia relative to other countries, raise net exports, which lowers aggregate expenditures

• As the price level rises, government spending falls, which lowers aggregate expenditures.

• Price level increases cause firms and consumers to hold more money, which raises the interest rate. Higher interest rates lower consumption and planned investment expenditures, which lowers aggregate expenditures.

• Price level increases raise real wealth which causes consumption spending and aggregate expenditures to decline.
Price level increases cause firms and consumers to hold more money, which raises the interest rate. Higher interest rates lower consumption and planned investment expenditures, which lowers aggregate expenditures.
Workers expect inflation to rise from 3% to 5% next year, this should

• shift the short run aggregate supply curve to the left.

• move the economy down along a stationary short run aggregate supply curve.

• move the economy up along a stationary short run aggregate supply curve.

• shift the short run aggregate supply curve to the right.
shift the short run aggregate supply curve to the left.
The demand for new motor vehicles falls when the economy enters a downturn, and as a result, motor vehicle manufacturers sack some workers. This would be an example of

• cyclical unemployment.
• natural unemployment.
• structural unemployment.
• frictional unemployment.
cyclical unemployment.
People who have borrowed money from banks at a fixed rate of interest will most likely

• benefit if the inflation rate is lower than anticipated.

• experience a rise in their real interest rate.

• experience losses if the inflation rate is higher than anticipated.

• benefit if the inflation rate is higher than anticipated.
benefit if the inflation rate is higher than anticipated
If actual inflation is less than expected inflation

• the actual real wage is greater than the expected real wage.

• firms will hire more workers than they planned.

• the actual real wage equals the expected real wage.

• the unemployment rate falls
the actual real wage is greater than the expected real wage.
If the Reserve Bank of Australia's policy is described as contractionary, then it would

• reduce the overnight cash rate.

• use open market operations to sell financial securities.

• increase the level of liquidity in the financial market.

• use open market operations to buy financial securities.
use open market operations to sell financial securities
The Reserve Bank of Australia has a policy of targeting the _______ over the business cycle.

• real cash rate at 2-3%.
• CPI inflation rate at 3-4%.
• nominal cash rate at 3-4%.
• CPI inflation rate at 2-3%.
CPI inflation rate at 2-3%.
If the economy is in recession, we would expect

• government outlays to be high and tax revenues to be low, probably leading to a budget surplus.

• government outlays to be high and tax revenues to be high, probably leading to a budget deficit.

• government outlays to be low and tax revenues to be low, probably leading to a budget surplus.

• government outlays to be high and tax revenues to be low, probably leading to a budget deficit.
government outlays to be high and tax revenues to be low, probably leading to a budget deficit.
Which of the following may be an appropriate policy if real equilibrium GDP lies to the left of the long-run aggregate supply curve?

• An increase in government purchases

• Contractionary fiscal policy to increase the budget surplus

• An increase in business income taxes to increase tax fairness

• An increase in individual income taxes to balance the budget
An increase in government purchases
Assume that the exchange rate between the dollar and the yen is ¥100 = $1. Suppose the exchange rate changes to ¥150 = $1. What is the price in yen of a $200 iPod before and after the exchange rate change?

• ¥300 before; ¥150 after
• ¥20 000 before; ¥30 000 after
• ¥300 before; ¥200 after
• ¥20 000 before; ¥15 000 after
¥20 000 before; ¥30 000 after
One advantage of adopting a fixed exchange rate is that

• interest cost fluctuations on foreign loans can be avoided.

• it makes business planning easier.

• the country can avoid current account surpluses.

• inflation can be avoided.
it makes business planning easier.
Which of the following scenarios is consistent with the Quantity Theory of Money?

• Money supply grows by 5%, price level grows by 2% and nominal GDP grows by 3%.

• Money supply grows by 4%, price level grows by 2% and real GDP grows by 3%.

• Money supply grows by 4%, price level falls by 1% and real GDP grows by 5%.

• Money supply grows by 5%, price level grows by 4% and real GDP falls by 1%.
Money supply grows by 4%, price level falls by 1% and real GDP grows by 5%.
There is a federal budget surplus when

• the government does not spend any revenue.

• the government spends more that it collects in taxes.

• the government spends less that it collects in taxes.

• the government spends the same amount it collects in taxes.
the government spends less that it collects in taxes.
Which of the following is NOT a component of aggregate expenditure in the AE model?

• Consumption spending
• Government spending
• Actual investment spending
• Planned investment spending
Actual investment spending
The level of real GDP in the long run is called

• low capacity GDP.
• potential GDP.
• short run GDP.
• frictional GDP.
potential GDP.
Which one of the following people is structurally unemployed?

• A Queensland fishery worker who is searching for a better job closer to home

• An office worker who has lost her job because of a general slowdown in economic activity

• A steel worker who is laid off but who expects to be called back soon

• A NSW welder who lost her job when her company relocated to W.A. and is currently looking for a job
A NSW welder who lost her job when her company relocated to W.A. and is currently looking for a job
When the base year is 2000, the CPIs for 2008 and 2009 are 150 and 155 respectively. What is the inflation rate between 2008 and 2009 if the base year is changed to 2008?

• 3.3%.
• 5%.
• 55%.
• Unknown due to insufficient information.
3.3%.
A decrease in the real interest rate leads to a ________ the demand for loanable funds curve, and a decrease in expected profit leads to a ________ the demand for loanable funds curve.

• movement down along; movement up along
• movement down along; rightward shift of
• rightward shift of; movement up along
• movement down along; leftward shift of
movement down along; leftward shift of
A financial intermediary's main function is to match ________ with excess funds to ________ who want to borrow funds.

• firms; households
• households; firms
• households; households
• firms; firms
households; firms
Which of the following is NOT a policy that can increase the accumulation of knowledge capital?

• Free provision of education

• Patent laws to encourage innovation

• Removing copyright laws to allow for the spread of knowledge

• Subsidized research and development
Removing copyright laws to allow for the spread of knowledge
An increase in aggregate demand causes an increase in ________ only in the short run, but causes an increase in ________ in both the short run and the long run.

• the price level; the price level
• real GDP; the price level
• the price level; real GDP
• real GDP; real GDP
real GDP; the price level
If consumers purchase fewer of those products that increase most in price and more of those products that decrease in price as compared to the CPI basket, then

• changes in the CPI accurately reflect the true rate of inflation.

• changes in the CPI overstate the true rate of inflation.

• changes in the CPI understate the true rate of inflation.

• changes in the CPI are unrelated to the true rate of inflation.
changes in the CPI overstate the true rate of inflation.
If the RBA wants to lower the ______, it can ______ banks.

• inflation rate; buy securities from
• cash rate; buy securities from
• 10-year interest rate; sell securities to
• cash rate; sell securities to
cash rate; buy securities from
Increasing government debt relative to GDP does NOT cause which of the following?

• An opportunity cost for the funds used to service the debt

• Lower interest repayments relative to the size of GDP

• The possibility of higher taxes in the future

• Crowding out
Lower interest repayments relative to the size of GDP
Assume that some people who receive bank loans do not deposit the full amount of the loan into a bank. This will cause the deposit multiplier to be it would have been if all loans are deposited in banks.

• either greater than or smaller than
• smaller than
• the same as
• greater than
smaller than
If the MPC is 0.95, then a $10 million increase in disposable income will

• increase consumption by $5 million.
• increase consumption by $950 million.
• increase saving by $9.5 million.
• increase saving by $0.5 million
increase saving by $0.5 million
A federal budget surplus could be reduced by

• raising taxes.
• lowering .interest rates.
• increasing transfer payments.
• lowering government spending.
increasing transfer payments.
Not enforcing property rights in an economy will

• not change the level of investment.
• raise the level of investment.
• cause the market system to work efficiently.
• lower the level of investment.
lower the level of investment.
Which of the following correctly describes how an increase in the price level affects, consumption spending?

• An increase in the price level raises real wealth, which causes consumption to increase.

• An increase in the price level decreases the amount of money a household needs to buy goods, raises the interest rate, which causes consumption to increase.

• An increase in the price level lowers real wealth, which causes consumption to decrease.

• An increase in the price level increases the amount of money a household needs to buy goods, raises the interest rate, which causes consumption to increase.
An increase in the price level lowers real wealth, which causes consumption to decrease.
If CAB =current account balance, I =private sector investment, S =national saving and NX =net exports, then

• I = CAB - S.
• CAB + NX = S.
• CAB = I + NX.
• CAB + I = S.
CAB + I = S.
Commodity money is

• a good that is designated as money by law.

• a good used as money that has no intrinsic value.

• a good used as money that also has value independent of its use as money.

• a good used as money that has no secondary use.
a good used as money that also has value independent of its use as money
If the Reserve Bank of Australia pursues expansionary monetary policy, ceteris paribus,

• aggregate demand will rise, and the price level will fall.

• aggregate demand will fall, and the price level will rise.

• aggregate demand will rise, and the price level will rise .

• aggregate demand will fall, and the price level Will fall.
aggregate demand will rise, and the price level will rise .
The slope of the consumption function is equal to

• the change in national income divided by the change in consumption.

• the change in consumption divided by the change in disposable income.

• the change in disposable income divided by the change in consumption.

• the change in consumption divided by the change in personal income.
the change in consumption divided by the change in disposable income.
Macroeconomics involves the economic issues of:

• how the economy should organise resources within a particular industry.

• how to generate full employment, price stability and maintain long-term economic growth

• profit maximisation by firms.

• how firms choose the prices they should charge for their products.
how to generate full employment, price stability and maintain long-term economic growth
A transfer payment is a payment by the government to an individual for

• a consumption good.

• an investment good.

• a service, such as a payment to hospital nurses and school teachers.

• which the government does not receive a good or service in return.
which the government does not receive a good or service in return.
The Bretton Woods system is

• a system of fixed exchange rates based on the gold standard.

• a system of floating exchange rates where central banks floated the value of their currencies.

• a system of fixed exchange rates where central banks fixed the value of their currencies against the US dollar.

• a system of managed-float exchange rates where demand and supply mainly determined the value of currencies with occasional government intervention.
a system of fixed exchange rates where central banks fixed the value of their currencies against the US dollar.
When the capital stock per hour worked

• decreases, labour productivity increases.
• increases, labour productivity increases.
• increases, capital productivity increases.
• increases, labour productivity falls, as workers are being replaced with capital and machinery.
increases, labour productivity increases.
In the model of the market for loanable funds, which of the following will NOT shift the demand curve for loanable funds?

• The effect of technological change on profitability.

• Lower interest rates.

• Expectations of high returns to investments.

• The expectation of a recession by businesses.
Lower interest rates.
If net income and net transfers are $O,and a country's purchases of foreign goods and services are $25 billion while its sales of goods and services overseas are $26 billion,

• it has a surplus of $1 billion in its balance of payments.

• it has a $1 billion deficit in its current account.

• it has a surplus. of $26 billion in its current account.

• it has a $1 billion surplus in its current account.
it has a $1 billion surplus in its current account.
Under the current operation of monetary policy in Australia, the money supply is

• perfectly elastic at the current interest rate.
• perfectly inelastic at the current interest rate.
• fixed by the Reserve Bank of Australia.
• targeted by the use of open market operations.
perfectly elastic at the current interest rate.
The tax wedge, the smaller the difference between pre-tax and post tax returns for an economic activity, the of that activity will occur.

• larger; more
• larger; less
• smaller; less
• smaller; more
smaller; more
A federal budget deficit leads to a(n)

• increase in interest rates, a depreciation of the dollar, and an increase in net exports.

• decrease in interest rates, an appreciation of the dollar, and a decline in net exports.

• increase in interest rates, an appreciation of the dollar, and a decline in net exports.

• decrease in interest rates, a depreciation of the dollar, and a decline in net exports.
increase in interest rates, an appreciation of the dollar, and a decline in net exports.
Suppose that average productivity of Chinese firms increases more rapidly than the average productivity of Australian firms, then

• production costs in China rise, quantity demanded for Chinese products falls, the value of yuan (RMB) falls against the dollar.

• production costs in China fall, quantity demanded for Chinese products rise, the value of yuan (RMB) rises against the dollar.

• production costs in China rise, quantity demanded for Chinese products rises, the value of yuan (RMB) rises against the dollar.

• production costs in China fall, quantity demanded for Chinese products rise, the value of yuan (RMB) falls against. the dollar.
production costs in China fall, quantity demanded for Chinese products rise, the value of yuan (RMB) rises against the dollar.
Suppose that the economy is currently in a recession and that economic forecasts indicate that the economy will soon enter an expansionary phase. As a result,

• expected profitability of new investment in plant and machinery increases and the supply of loanable funds rises, while demand remains unchanged.

• expected profitability of new investment in plant and machinery increases and both the demand for and supply of loanable funds rises.

• expected profitability of new investment in plant and machinery increases and the demand for loanable funds falls.

• expected profitability of new investment in plant and machinery increases and the demand for loanable funds rises.
expected profitability of new investment in plant and machinery increases and the demand for loanable funds rises.
If a country passes a labour law limiting the amount of hours worked per week, GDP would ________, and leisure would _________.

• decrease; increase
• increase; decrease
• decrease; decrease
• increase; increase
decrease; increase
*A professional has been being unemployed since her company relocated overseas
one year ago. While she is. searching for a new job she would be classified as:*

• cyclically unemployed
• structurally unemployed
• frictionally unemployed
• not in the labour force
structurally unemployed
Knowledge capital is ____in production and ______ a as a result, firms ______ free ride.

• non-rival; excludable; can
• non-rival; non-excludable; can
• rival; non-excludable; cannot
• non-rival; non-excludable; cannot
non-rival; non-excludable; can
The Trade weighted index (TWI) is

• a measure of the price changes in' goods and services traded between Australia and the rest of the world.

• a measure of the difference between exports and imports, to establish the balance of trade.

• a measure of the value of the Australian dollar against a basket of currencies of its major trading partners.

• a measure of the volume of international trade throughout the world.
a measure of the value of the Australian dollar against a basket of currencies of its major trading partners.
The money demand curve is downward sloping because

• lower interest rates cause households and firms to switch from money to shares.

• lower interest rates cause households and firms to switch from financial assets to money.

• lower interest rates cause households and firms to switch from money to financial assets.

• lower interest rates cause households and firms to switch from money to bonds.
lower interest rates cause households and firms to switch from financial assets to money.
In an open economy, contractionary monetary policy will have a secondary effect on GDP because

• net exports will rise due to the higher foreign exchange value of the dollar.

• net exports will rise due to the lower foreign exchange value of the dollar.

• net exports will fall due to the higher foreign exchange value of the dollar.

• net exports will fall due to the lower foreign exchange value of the dollar.
net exports will fall due to the higher foreign exchange value of the dollar.
Economists during the early 1960s thought of the Phillips Curve as a "policy menu" because they thought that the Phillips Curve:

• represented a structural relationship in the economy that would not change as a result of policy changes.

• represented a direct relationship between unemployment and inflation in the short run.

• presented policy makers with a reliable menu of combinations of unemployment and inflation.

• represented a relationship that did not depend on consumers and firms and could change over time.
represented a structural relationship in the economy that would not change as a result of policy changes.
Which of the following is TRUE regarding the social costs of unemployment?

i. The costs of unemployment are spread equally across economic classes.

ii. Prolonged unemployment causes a loss of human capital.

iii. Because of unemployment benefits, loss of income is a minor concern



• i and ii.
• i only.
• i and iii.
• ii only.
ii only.
Which of the following four statements is correct?

• With a multiplier of 2, an increase of $125 billion in the money supply will increase GDP by less than $250billion.
• With a multiplier of 2, an <increase of $125 billion in the money supply will increase GDP by $250billion.

• With a multiplier of 2, an increase of $125 billion in the money supply will increase GDP by more than $250billiion.

• None of the above as the multiplier does not apply to increases in the money supply.
None of the above as the multiplier does not apply to increases in the money supply.
Business cycles are

• unpredictable, and don't always have two phases and two turning points.

• unpredictable, but always have two phases and two turning points.

• predictable, with a recession following a trough.

• irregular, with some having two recessions and no expansion.
unpredictable, but always have two phases and two turning points
Crowding out will be greater:

• the more sensitive investment spending is to changes in the interest rate

• the further equilibrium GDP is below potential GDP.

• the less sensitive consumption spending is to changes in the interest rate.

• if the economy is in recession, rather than at full employment.
the more sensitive investment spending is to changes in the interest rate
Let G = government purchases; T = taxes; TR = transfer payments. The budget surplus is defined as:

• T + (G - TR) > 0.
• T - (G + TR) < 0.
• T + (G + TR) > 0.
• T - (G + TR) > 0.
T - (G + TR) > 0.
Which of the following will shift the aggregate demand curve to the left, ceteris paribus?

• An increase in interest rates.
• An increase in disposable income.
• An increase in net exports.
• An increase in the price level
An increase in interest rates.
When aggregate expenditure is less than real GDP, which of the following is true?

• Households bought more new homes than they anticipated.

• There was an unplanned increase in inventories.

• Firms spent more on capital goods than they anticipated.

• All of the above must be true when aggregate expenditure is less than GDP.
There was an unplanned increase in inventories.
The multiplier effect is the series of ________ increases in ________ expenditures that result from an initial increase in ________ expenditures.

• autonomous; consumption; induced
• autonomous; total; induced
• induced; total; autonomous
• induced; consumption; autonomous
induced; consumption; autonomous
It can be ________ difficult to effectively time fiscal policy than monetary policy because ________.

• less; monetary policy takes longer to decide and change

• more; fiscal policy takes longer to implement

• more; fiscal policy can be more quickly decided and changed

• less; monetary policy takes longer to implement
more; fiscal policy takes longer to implement
If the CPI was 228 at the end of 2007 and 236 at the end of 2008, what was the inflation rate in 2008?

• 2.36 percent
• 3.4 percent
• 3.5 percent
• 8 percent
3.5 percent
If the labour force participation rate is rising and the working-age population is not changing, then this implies that

• size of the labour force is falling.

• size of the labour force is rising.

• number of unemployed people is falling and the size of the labour force is rising.

• number of employed people is rising and the size of the labour force is falling.
size of the labour force is rising
Inflation that is ________ than what is expected benefits ________ and hurts ________.

• greater; lenders; no-one
• less; lenders; borrowers
• greater; lenders; borrowers
• less; borrowers; lenders
less; lenders; borrowers
Suppose the economy is experiencing frictional unemployment of 1 percent, structural unemployment of 3 percent and cyclical unemployment of 4 percent. What is the natural unemployment rate?

• 3 percent
• 4 percent
• 5 percent
• 8 percent
4 percent
If expansionary monetary policy is used, then which of the following would be most likely to enhance the effect of the expansionary policy on aggregate demand?

• Interest rates would increase, leading to an exchange rate depreciation and a rise in net exports.

• Interest rates would increase, leading to an exchange rate appreciation and a fall in net exports.

• Interest rates would decrease, leading to an exchange rate appreciation and a fall in net exports.

• Interest rates would decrease, leading to an exchange rate depreciation and a rise in net exports.
Interest rates would decrease, leading to an exchange rate depreciation and a rise in net exports
Assume that a Big Mac burger costs $3.57 in Australia and 7.80 zlotys in Poland. If the exchange rate is 3 zlotys per dollar, what is the dollar cost of a Big Mac in Poland?

• $1.19
• $2.60
• $4.23
• $10.71
$2.60
If the real wage rate is $10.00 an hour and the price level is 60, the money wage rate is

• $6.00 an hour.
• $10.00 an hour.
• $16.67 an hour.
• $16.75 an hour.
$6.00 an hour.
Suppose the economy is currently in a recession and that economic forecasts indicate that the economy will soon enter an expansionary phase. As a result,

• expected profitability of new investment in plant and machinery increases and the supply of loanable funds rises, while demand remains unchanged.

• expected profitability of new investment in plant and machinery increases and both the demand for and supply of loanable funds decline.

• expected profitability of new investment in plant and machinery increases and the demand for loanable funds falls.

• expected profitability of new investment in plant and machinery increases and the demand for loanable funds rises.
expected profitability of new investment in plant and machinery increases and the demand for loanable funds rises.
A decrease in value of a country's currency relative to other currencies

• Raises imports, reduces exports, and increases the balance of trade on goods and services.

• Reduces imports, raises exports, and reduces the balance of trade on goods and services.

• Reduces imports, raises exports, and increases the balance of trade on goods and services.

• Raises imports, reduces exports, and reduces the balance of trade on goods and services.
Reduces imports, raises exports, and increases the balance of trade on goods and services.
If the dollar becomes weaker against foreign currencies, the AE line will

• shift up.
• shift down.
• not be affected.
• become flatter.
shift up.
Reducing the marginal tax rate on individual income will:

• lower the return to entrepreneurship and encourage the opening of new businesses.

• reduce the tax wedge faced by workers and increase labour supplied.

• raise the return to entrepreneurship and discourage the opening of new businesses.

• increase the tax wedge faced by workers and increase labour supplied.
reduce the tax wedge faced by workers and increase labour supplied.
Which of the following correctly describes how an increase in the price level affects consumption spending?

• An increase in the price level lowers real wealth which causes consumption to decrease.

• An increase in the price level increases the amount of money a household needs to buy goods, raises the interest rate, which causes consumption to increase.

• An increase in the price level decreases the amount of money a household needs to buy goods, raises the interest rate, which causes consumption to increase.

• An increase in the price level raises real wealth which causes consumption to increase
An increase in the price level lowers real wealth which causes consumption to decrease.
The unemployment rate is calculated by

• dividing the number of unemployed people by the number of working individuals, and multiplying by 100.

• dividing the number of unemployed people by the number in the working-age population, and multiplying by 100.

• dividing the number of unemployed people by the number of people in the labour force, and dividing by 100.

• dividing the number of unemployed people by the sum of the number of working individuals plus the number of unemployed people, and multiplying by 100.
dividing the number of unemployed people by the sum of the number of working individuals plus the number of unemployed people, and multiplying by 100.
An increase in ________ shifts ________ the production function, and makes it possible to produce a higher level of GDP with ________ capital per hour worked.

• technology; up; the same amount of

• labour productivity; down; the same amount of

• technology; down; the same amount of

• labour productivity; down; a lesser amount
technology; up; the same amount of
The trade weighted index (TWI) is

• a measure of the price changes in goods and services traded between Australia and the rest of the world.

• a measure of the difference between exports and imports, to establish the balance of trade.

• a measure of the value of the Australian dollar against a basket of currencies of its major trading partners.

• a measure of the volume of international trade throughout the world.
a measure of the value of the Australian dollar against a basket of currencies of its major trading partners.
In a country with a working-age population of 20 million, 13 million are employed, 1.5 million are unemployed, and 1 million of the employed are working part-time, half of whom wish to work full-time. The labour force participation rate is

• 57.5 percent.
• 65 percent.
• 72.5 percent.
• 77.5 percent.
72.5 percent.
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