Question 1

For a homeowner, the rental value of the home is estimated and included in GDP.

Accepted Answer

A) True 
 B)False

Question 2

Nominal GDP uses current market prices and real GDP measures GDP using base-year prices.

Accepted Answer

A) True 
 B)False

Question 3

In reality, the GDP-GDI gap for the United States

Accepted Answer

A)  is due to the presence of substantial black market activity. 
B)  is due to different accounting standards among countries in the world. 
C)  represents a small fraction of measured activity. 
D)  represents the impact of transfer payments. 
A)  is due to the presence of substantial black market activity. 
B)  is due to different accounting standards among countries in the world. 
C)  represents a small fraction of measured activity. 
D)  represents the impact of transfer payments.

Question 4

Which of the following is the best measure of a nation's standard of living?

Accepted Answer

A)  nominal GDP 
B)  market GDP 
C)  real GDP per capita 
D)  nominal GDP per capita 
A)  nominal GDP 
B)  market GDP 
C)  real GDP per capita 
D)  nominal GDP per capita

Question 5

Suppose the personal income in a nation equals $5 billion, and personal income taxes equal
$1 billion. The disposable personal income equals:

Accepted Answer

A)  $4 billion. 
B)  $5 billion. 
C)  $6 billion. 
D)  $1 billion. 
A)  $4 billion. 
B)  $5 billion. 
C)  $6 billion. 
D)  $1 billion.

Question 6

The gross domestic product of an economy is defined as the:

Accepted Answer

A)  total value of all industrial goods produced and sold during a given period. 
B)  total value of all final goods and services produced during a given period. 
C)  value of all noneconomic transactions made among consumers during a particular period. 
D)  value of all non-monetary transactions between consumers and firms during a given period. 
A)  total value of all industrial goods produced and sold during a given period. 
B)  total value of all final goods and services produced during a given period. 
C)  value of all noneconomic transactions made among consumers during a particular period. 
D)  value of all non-monetary transactions between consumers and firms during a given period.

Question 7

Daniel, an U.S. resident, purchases a Mercedes car from a dealer based in German and ships it to the U.S. This activity negatively affects the U.S. GDP.

Accepted Answer

A) True 
 B)False

Question 8

What is the difference between real GDP and nominal GDP?

Accepted Answer

Real GDP and nominal GDP are two differe

Question 9

Use the following to answer questions .
Exhibit: Components of GDP for an Economy 1
  
-(Exhibit: Components of GDP for an Economy 1) What is the value of GDP?

Accepted Answer

A)  $1,820 billion 
B)  $2,170 billion 
C)  $2,080 billion 
D)  $2,550 billion 
A)  $1,820 billion 
B)  $2,170 billion 
C)  $2,080 billion 
D)  $2,550 billion

Question 10

Use the following to answer questions .
Exhibit: Components of GDP for an Economy 1
  
-(Exhibit: Components of GDP for an Economy 1) What is the total value of government purchases of goods and services?

Accepted Answer

A)  $570 billion 
B)  $280 billion 
C)  $370 billion 
D)  $190 billion 
A)  $570 billion 
B)  $280 billion 
C)  $370 billion 
D)  $190 billion

Question 11

Unemployment benefits provided by the U.S. government make up a major portion of the U.S. government purchases.

Accepted Answer

A) True 
 B)False

Question 12

What is the difference between a final good and an intermediate good? Give one example of each. How are they treated in GDP calculations?

Accepted Answer

A final good is a product that is purcha

Question 13

China's gross national product can be calculated from China's GDP by:

Accepted Answer

A)  adding the value of output produced by China's residents and sold abroad. 
B)  adding the income earned by China's residents from the rest of the world and subtracting payments made by China's residents to the rest of the world. 
C)  subtracting the value of output produced by China's residents and sold abroad. 
D)  subtracting the income earned by China's residents from the rest of the world and adding payments made by China's residents to the rest of the world. 
A)  adding the value of output produced by China's residents and sold abroad. 
B)  adding the income earned by China's residents from the rest of the world and subtracting payments made by China's residents to the rest of the world. 
C)  subtracting the value of output produced by China's residents and sold abroad. 
D)  subtracting the income earned by China's residents from the rest of the world and adding payments made by China's residents to the rest of the world.

Question 14

Economic data adjusted for price level changes are said to be expressed in terms of current dollars.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is an example of a transfer payment?

Accepted Answer

A)  The President's salary 
B)  A payment for a gambling debt 
C)  A barber's income 
D)  A pension payment to retired military personnel 
A)  The President's salary 
B)  A payment for a gambling debt 
C)  A barber's income 
D)  A pension payment to retired military personnel

Question 16

Use the following to answer questions .
Exhibit: Stages in the Production of an Office Building
  
-(Exhibit: Stages in the Production of an Office Building) A mining firm extracts iron from the earth. A steel mill converts the iron to steel beams for use in construction. A construction company uses the steel beams to make a building. Assume that the total product of these firms represents the only components of the building and that they will have no other uses. What is the valued-added by Crane Construction?

Accepted Answer

A)  $725,000 
B)  $825,000 
C)  $950,000 
D)  $1,050,000 
A)  $725,000 
B)  $825,000 
C)  $950,000 
D)  $1,050,000

Question 17

Net national product equals:

Accepted Answer

A)  gross national product plus depreciation. 
B)  gross national product minus depreciation. 
C)  gross domestic product minus gross national product. 
D)  gross national product minus taxes. 
A)  gross national product plus depreciation. 
B)  gross national product minus depreciation. 
C)  gross domestic product minus gross national product. 
D)  gross national product minus taxes.

Question 18

Which of the following is an example of an intermediate good or service?

Accepted Answer

A)  The purchase of a new yacht by a boating enthusiast 
B)  The purchase of lumber by a construction company 
C)  The salaries paid to military personnel 
D)  The salary earned by a construction worker 
A)  The purchase of a new yacht by a boating enthusiast 
B)  The purchase of lumber by a construction company 
C)  The salaries paid to military personnel 
D)  The salary earned by a construction worker

Question 19

Use the following to answer questions .
Exhibit: Components of GDP for an Economy 2
  
-(Exhibit: Components of GDP for an Economy 2) What is the value of government purchases of goods and services?

Accepted Answer

A)  $100 billion 
B)  $160 billion 
C)  $300 billion 
D)  $192 billion 
A)  $100 billion 
B)  $160 billion 
C)  $300 billion 
D)  $192 billion

Question 20

Taxes imposed on firms on the production or sale of goods and services are called:

Accepted Answer

A)  output tax. 
B)  profit tax. 
C)  direct business taxes. 
D)  indirect business taxes. 
A)  output tax. 
B)  profit tax. 
C)  direct business taxes. 
D)  indirect business taxes.

For a homeowner, the rental value of the home is estimated and included in GDP.

Nominal GDP uses current market prices and real GDP measures GDP using base-year prices.

In reality, the GDP-GDI gap for the United States

Which of the following is the best measure of a nation's standard of living?

Suppose the personal income in a nation equals $5 billion, and personal income taxes equal $1 billion. The disposable personal income equals:

The gross domestic product of an economy is defined as the:

Daniel, an U.S. resident, purchases a Mercedes car from a dealer based in German and ships it to the U.S. This activity negatively affects the U.S. GDP.

What is the difference between real GDP and nominal GDP?

Use the following to answer questions . Exhibit: Components of GDP for an Economy 1 -(Exhibit: Components of GDP for an Economy 1) What is the value of GDP?

Use the following to answer questions . Exhibit: Components of GDP for an Economy 1 -(Exhibit: Components of GDP for an Economy 1) What is the total value of government purchases of goods and services?

Unemployment benefits provided by the U.S. government make up a major portion of the U.S. government purchases.

What is the difference between a final good and an intermediate good? Give one example of each. How are they treated in GDP calculations?

China's gross national product can be calculated from China's GDP by:

Economic data adjusted for price level changes are said to be expressed in terms of current dollars.

Which of the following is an example of a transfer payment?

Net national product equals:

Which of the following is an example of an intermediate good or service?

Use the following to answer questions . Exhibit: Components of GDP for an Economy 2 -(Exhibit: Components of GDP for an Economy 2) What is the value of government purchases of goods and services?

Taxes imposed on firms on the production or sale of goods and services are called:

Economics: the Study of Choice

Demand and Supply

Applications of Supply and Demand

Macroeconomics: the Big Picture

Aggregate Demand and Aggregate Supply

Economic Growth

The Nature and Creation of Money

Financial Markets and the Economy

Monetary Policy and the Fed

Government and Fiscal Policy

Consumption and the Aggregate Expenditures Model

Investment and Economic Activity

Net Exports and International Finance

Inflation and Unemployment

A Brief History of Macroeconomic Thought and Policy

Inequality, Poverty, and Discrimination

Filters

Exam 6: Measuring Total Output and Income

For a homeowner, the rental value of the home is estimated and included in GDP.

Nominal GDP uses current market prices and real GDP measures GDP using base-year prices.

In reality, the GDP-GDI gap for the United States

Which of the following is the best measure of a nation's standard of living?

Suppose the personal income in a nation equals $5 billion, and personal income taxes equal $1 billion. The disposable personal income equals:

The gross domestic product of an economy is defined as the:

Daniel, an U.S. resident, purchases a Mercedes car from a dealer based in German and ships it to the U.S. This activity negatively affects the U.S. GDP.

What is the difference between real GDP and nominal GDP?

Use the following to answer questions . Exhibit: Components of GDP for an Economy 1 -(Exhibit: Components of GDP for an Economy 1) What is the value of GDP?

Use the following to answer questions . Exhibit: Components of GDP for an Economy 1 -(Exhibit: Components of GDP for an Economy 1) What is the total value of government purchases of goods and services?

Unemployment benefits provided by the U.S. government make up a major portion of the U.S. government purchases.

What is the difference between a final good and an intermediate good? Give one example of each. How are they treated in GDP calculations?

China's gross national product can be calculated from China's GDP by:

Economic data adjusted for price level changes are said to be expressed in terms of current dollars.

Which of the following is an example of a transfer payment?

Net national product equals:

Which of the following is an example of an intermediate good or service?

Use the following to answer questions . Exhibit: Components of GDP for an Economy 2 -(Exhibit: Components of GDP for an Economy 2) What is the value of government purchases of goods and services?

Taxes imposed on firms on the production or sale of goods and services are called:

Economics: the Study of Choice

Demand and Supply

Applications of Supply and Demand

Macroeconomics: the Big Picture

Aggregate Demand and Aggregate Supply

Economic Growth

The Nature and Creation of Money

Financial Markets and the Economy

Monetary Policy and the Fed

Government and Fiscal Policy

Consumption and the Aggregate Expenditures Model

Investment and Economic Activity

Net Exports and International Finance

Inflation and Unemployment

A Brief History of Macroeconomic Thought and Policy

Inequality, Poverty, and Discrimination

Filters