Question 1

The state of Florida spends $3 million to repave highways.This is included in the ________ category of gross domestic product (GDP).

Accepted Answer

A)  consumption 
B)  investment 
C)  government purchases 
D)  net exports 
E)  services 
A)  consumption 
B)  investment 
C)  government purchases 
D)  net exports 
E)  services

Question 2

Suppose a particular model of smartphone contains $150 worth of raw materials and requires $175 worth of labor to produce.One day,one of these phones sells for $400.The seller would have been willing to sell it for as little as $375,whereas the buyer would have been willing to pay as much as $425.Which dollar amount would be used to calculate this transaction's contribution to gross domestic product (GDP)?

Accepted Answer

A)  $150 
B)  $175 
C)  $375 
D)  $400 
E)  $425 
A)  $150 
B)  $175 
C)  $375 
D)  $400 
E)  $425

Question 3

Consider the following figure to answer the following questions:  
-During which year was average income climbing the most rapidly?

Accepted Answer

A)  2000 
B)  2001 
C)  2004 
D)  2005 
E)  2009 
A)  2000 
B)  2001 
C)  2004 
D)  2005 
E)  2009

Question 4

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2012.  
-What was the real gross domestic product (GDP)in 2013?

Accepted Answer

A)  $5,400 
B)  $6,300 
C)  $6,450 
D)  $1,700 
E)  $13,600 
A)  $5,400 
B)  $6,300 
C)  $6,450 
D)  $1,700 
E)  $13,600

Question 5

If over a period of time real gross domestic product (GDP)increases while nominal GDP decreases,then this implies

Accepted Answer

A)  a significant rise in the price level. 
B)  a significant drop in the price level. 
C)  that real GDP is much less than nominal GDP. 
D)  that the given period occurs before the base period. 
E)  that the given period year occurs after the base period. 
A)  a significant rise in the price level. 
B)  a significant drop in the price level. 
C)  that real GDP is much less than nominal GDP. 
D)  that the given period occurs before the base period. 
E)  that the given period year occurs after the base period.

Question 6

Which is the largest component of U.S.gross domestic product (GDP)?

Accepted Answer

A)  consumption 
B)  investment 
C)  government purchases 
D)  exports 
E)  imports 
A)  consumption 
B)  investment 
C)  government purchases 
D)  exports 
E)  imports

Question 7

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2015.  
-What was the gross domestic product (GDP)deflator in 2016?

Accepted Answer

A)  108.3 
B)  103 
C)  120 
D)  130 
E)  110 
A)  108.3 
B)  103 
C)  120 
D)  130 
E)  110

Question 8

Which of the following is a sign that an economy is in poor health?

Accepted Answer

A)  a prolonged decline in total output 
B)  failure of total output to equal total income 
C)  failure of output to remain constant over time 
D)  a shift in production,from goods to services 
E)  a prolonged rise in total income 
A)  a prolonged decline in total output 
B)  failure of total output to equal total income 
C)  failure of output to remain constant over time 
D)  a shift in production,from goods to services 
E)  a prolonged rise in total income

Question 9

Consider the following data to answer the following questions:  
-Which two countries have the same average living standard?

Accepted Answer

A)  B and C 
B)  C and D 
C)  A and B 
D)  C and E 
E)  A and E 
A)  B and C 
B)  C and D 
C)  A and B 
D)  C and E 
E)  A and E

Question 10

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2012.  
-What was the gross domestic product (GDP)deflator in 2013?

Accepted Answer

A)  116.67 
B)  108.57 
C)  100 
D)  119.44 
E)  102.38 
A)  116.67 
B)  108.57 
C)  100 
D)  119.44 
E)  102.38

Question 11

Real gross domestic product (GDP)is equal to

Accepted Answer

A)  current prices* base year output. 
B)  current prices * current output. 
C)  base year prices *base year output. 
D)  base year prices * current output. 
E)  current output / base year prices. 
A)  current prices* base year output. 
B)  current prices * current output. 
C)  base year prices *base year output. 
D)  base year prices * current output. 
E)  current output / base year prices.

Question 12

Hollister Co.stocks up on T-shirts for the holiday season.This inventory is included in the ________ category of gross domestic product (GDP).

Accepted Answer

A)  consumption 
B)  investment 
C)  government purchases 
D)  net exports 
E)  services 
A)  consumption 
B)  investment 
C)  government purchases 
D)  net exports 
E)  services

Question 13

Nominal gross domestic product (GDP)increased from $15.62 trillion to $16.09 trillion,and the price level increased from 120.0 to 122.4.Rounding to the nearest second decimal,the growth rate of real GDP was approximately

Accepted Answer

A)  2.92 percent. 
B)  3.01 percent. 
C)  1.87 percent. 
D)  1.00 percent. 
E)  2.00 percent. 
A)  2.92 percent. 
B)  3.01 percent. 
C)  1.87 percent. 
D)  1.00 percent. 
E)  2.00 percent.

Question 14

If real gross domestic product (GDP)grew by 2 percent and the inflation rate was 2 percent,then nominal GDP grew by

Accepted Answer

A)  2 percent. 
B)  4 percent. 
C)  0 percent. 
D)  1 percent. 
E)  3 percent. 
A)  2 percent. 
B)  4 percent. 
C)  0 percent. 
D)  1 percent. 
E)  3 percent.

Question 15

Consider the following data that identifies real gross domestic product (GDP) in comparison to the long-run trend of real GDP to answer the following questions:  
-Between quarter 7 and quarter 8,real gross domestic product (GDP)grew by what percentage?

Accepted Answer

A)  -2 percent 
B)  3 percent 
C)  1 percent 
D)  6 percent 
E)  2 percent 
A)  -2 percent 
B)  3 percent 
C)  1 percent 
D)  6 percent 
E)  2 percent

Question 16

A country's nominal gross domestic product (GDP)has declined over the last year.Are the people in the country necessarily worse off,on average? Explain.

Accepted Answer

The people are not necessarily worse off

Question 17

If gross domestic product (GDP)is increasing,is the country necessarily producing a larger quantity of goods and services? Explain.

Accepted Answer

No,the country is not necessarily produc

Question 18

Consider the following data, where gross domestic product (GDP) values are measured in millions of dollars, to answer the following questions:  
-What was the growth rate of real gross domestic product (GDP)from 2011 to 2012?

Accepted Answer

A)  2 percent 
B)  1 percent 
C)  10 percent 
D)  20 percent 
E)  5 percent 
A)  2 percent 
B)  1 percent 
C)  10 percent 
D)  20 percent 
E)  5 percent

Question 19

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2012.  
-What was the rate of inflation between the two years?

Accepted Answer

A)  19.44 percent 
B)  8.57 percent 
C)  6.67 percent 
D)  2.38 percent 
E)  16.67 percent 
A)  19.44 percent 
B)  8.57 percent 
C)  6.67 percent 
D)  2.38 percent 
E)  16.67 percent

Question 20

A computer company builds a new factory.This is included in the ________ category of gross domestic product (GDP).

Accepted Answer

A)  consumption 
B)  investment 
C)  government purchases 
D)  net export 
E)  services 
A)  consumption 
B)  investment 
C)  government purchases 
D)  net export 
E)  services

Exam 19: Introduction to Macroeconomics and Gross Domestic Product

The state of Florida spends $3 million to repave highways.This is included in the ________ category of gross domestic product (GDP).

Consider the following figure to answer the following questions: -During which year was average income climbing the most rapidly?

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2012. -What was the real gross domestic product (GDP)in 2013?

If over a period of time real gross domestic product (GDP)increases while nominal GDP decreases,then this implies

Which is the largest component of U.S.gross domestic product (GDP)?

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2015. -What was the gross domestic product (GDP)deflator in 2016?

Which of the following is a sign that an economy is in poor health?

Consider the following data to answer the following questions: -Which two countries have the same average living standard?

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2012. -What was the gross domestic product (GDP)deflator in 2013?

Real gross domestic product (GDP)is equal to

Hollister Co.stocks up on T-shirts for the holiday season.This inventory is included in the ________ category of gross domestic product (GDP).

Nominal gross domestic product (GDP)increased from $15.62 trillion to $16.09 trillion,and the price level increased from 120.0 to 122.4.Rounding to the nearest second decimal,the growth rate of real GDP was approximately

If real gross domestic product (GDP)grew by 2 percent and the inflation rate was 2 percent,then nominal GDP grew by

Consider the following data that identifies real gross domestic product (GDP) in comparison to the long-run trend of real GDP to answer the following questions: -Between quarter 7 and quarter 8,real gross domestic product (GDP)grew by what percentage?

A country's nominal gross domestic product (GDP)has declined over the last year.Are the people in the country necessarily worse off,on average? Explain.

If gross domestic product (GDP)is increasing,is the country necessarily producing a larger quantity of goods and services? Explain.

Consider the following data, where gross domestic product (GDP) values are measured in millions of dollars, to answer the following questions: -What was the growth rate of real gross domestic product (GDP)from 2011 to 2012?

Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the following questions. Assume that the base year is 2012. -What was the rate of inflation between the two years?

A computer company builds a new factory.This is included in the ________ category of gross domestic product (GDP).

Five Foundations of Economics

Model Building and Gains From Trade

The Market at Work: Supply and Demand

Elasticity

Market Outcomes and Tax Incidence

Price Controls

Market Inefficiencies: Externalities and Public Goods

Business Costs and Production

Firms in a Competitive Market

Understanding Monopoly

Price Discrimination

Monopolistic Competition and Advertising

Oligopoly and Strategic Behavior

The Demand and Supply of Resources

Income,inequality,and Poverty

Consumer Choice

Behavioral Economics and Risk Taking

Health Insurance and Health Care

Unemployment

The Price Level and Inflation

Savings,interest Rates,and the Market for Loanable Funds

Financial Markets and Securities

Economic Growth and the Wealth of Nations

Growth Theory

The Aggregate Demandaggregate Supply Model

The Great Recession, the Great Depression, and Great Macroeconomic Debates

Federal Budgets: the Tools of Fiscal Policy

Fiscal Policy

Money and the Federal Reserve

Monetary Policy

International Trade

International Finance

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