2. The four types of economic shifts that the United States has experienced are technological, structural, cyclical, and seasonal shifts.
3. GDP, unemployment rate, rate of inflation, and national debt all provide different indicators of the country's economic health. GDP measures the total value of goods and services produced in the country, unemployment rate shows the percentage of the labor force without a job, the rate of inflation measures the increase in prices of goods and services over time, and national debt reflects the amount of money the government has borrowed to finance its operations.
4. Both individuals and the government influence the economy. Individuals make economic decisions such as buying goods and services and investing their money, which can impact the overall economy. The government can influence the economy through fiscal policy (taxation and spending) and monetary policy (adjusting interest rates and the money supply).
5. The four stages of the business cycle are expansion, peak, contraction, and trough.
6. Yes, cars made in this country by a foreign-owned company would be included in GDP because they are produced domestically.
7. Working at a day-care center would be included in GDP because it is a paid service provided by a business. Babysitting at home would not be included in GDP because it is not an officially recognized economic transaction.
8. People who are unemployed but not looking for work are not included in the unemployment figures because they are not considered part of the labor force.
9. Inflation is especially difficult for retired people because it reduces the purchasing power of their fixed income, making it more difficult to afford basic necessities.
10. Deflation can be a bad thing because it can lead to decreased demand for goods and services, resulting in decreased production and employment.
11. This is not necessarily an example of inflation because the price increase could be due to factors specific to that store or product.
12. There would likely be more personal bankruptcies in the contraction and trough stages of the business cycle. Business formations may be more common in the expansion and peak stages.
13. The standard of living is higher in the United States than in many other countries due to factors such as a high level of education, technological innovation, and a relatively stable political system. The country also has a high level of economic freedom, which allows for greater opportunities for entrepreneurship and innovation.