Exam 6: Measuring Total Output and Income

GDP may be calculated by totaling either the market values of all final goods and services or the income earned during production of those final goods and services.

Disposable personal income is that part of income that households:

Use the following to answer questions . Exhibit: The Circular Flow for the United States -(Exhibit: The Circular Flow for the United States) Washington State purchases four airplanes from Boeing. This expenditure falls under the:

Which of the following is an expenditure component of GDP?

The value of goods and services purchased by households during a particular period is called:

For computing GDP, the official measure of the value of all goods produced during a period for use in the production of other goods is called:

Use the following to answer questions . Exhibit: Circular Flow Model -(Exhibit: Circular Flow Model) The exhibit shows a simplified circular flow model where only consumption goods are being produced. The arrow marked "C" represents the flow of:

GDP can be found by adding the final value of all goods and services produced or by totaling all factor incomes (including indirect business taxes and depreciation) for the period.

Which of the following items would NOT be a part of private investment in the computation of GDP?

An increase in real GDP

Which of the following statements is true?

Which of the following items is a stock variable?

The gross domestic product of a nation can be measured:

The value of a final good or a service can be calculated by adding up all the values of intermediate goods or services at each stage of the production process.

Which of the following is counted as consumption expenditure?

In the circular flow model for an economy that produces only consumption goods:

Give three reasons why real GDP is not an adequate measure of a nation's well being. Despite these limitations, do you think real GDP is a useful statistic? Explain your answer.

Explain why transfer payments are not included in GDP.

Use the following to answer questions . Exhibit: The Circular Flow for the United States -(Exhibit: The Circular Flow for the United States) A New York restaurant purchases 1,000 cases of wine from a winery in France. This transaction is recorded as part of:

Goods and services produced in the domestic economy and sold abroad are called _____.