Question 1

Purchases of _____ are included in GDP.

Accepted Answer

A)  used goods 
B)  newly issued stocks 
C)  new foreign-produced investment goods 
D)  new capital goods 
A)  used goods 
B)  newly issued stocks 
C)  new foreign-produced investment goods 
D)  new capital goods

Question 2

Domestically produced goods and services sold to people in other countries are known as:

Accepted Answer

A)  imports. 
B)  investments. 
C)  exports. 
D)  transfer payments. 
A)  imports. 
B)  investments. 
C)  exports. 
D)  transfer payments.

Question 3

Use the following to answer questions:  
-(Table: Per Capita GDP) Use Table: Per Capita GDP. The growth rate of per capita real GDP from 2011 to 2014 was:

Accepted Answer

A)  200%. 
B)  50%. 
C)  -50%. 
D)  -33%. 
A)  200%. 
B)  50%. 
C)  -50%. 
D)  -33%.

Question 4

In the circular-flow diagram, the places where resources, especially capital and labor, are bought and sold are the:

Accepted Answer

A)  product markets. 
B)  factor markets. 
C)  households. 
D)  firms. 
A)  product markets. 
B)  factor markets. 
C)  households. 
D)  firms.

Question 5

Which example illustrates an intermediate good?

Accepted Answer

A)  stocks and bonds purchased by a business executive 
B)  a cellular telephone purchased by a college student 
C)  a wedding ring purchased by an engineer for his fiancée 
D)  tires General Motors purchased from Goodyear for new electric cars 
A)  stocks and bonds purchased by a business executive 
B)  a cellular telephone purchased by a college student 
C)  a wedding ring purchased by an engineer for his fiancée 
D)  tires General Motors purchased from Goodyear for new electric cars

Question 6

Use the following to answer questions:  
-(Figure 7-2: Expanded Circular-Flow Model) Use Figure 7-2: Expanded Circular-Flow Model The government has a budget:

Accepted Answer

A)  surplus of $150. 
B)  surplus of $220. 
C)  deficit of $70. 
D)  deficit of $200. 
A)  surplus of $150. 
B)  surplus of $220. 
C)  deficit of $70. 
D)  deficit of $200.

Question 7

GDP does NOT exclude:

Accepted Answer

A)  the value of leisure. 
B)  damage to the environment. 
C)  the value of housework. 
D)  the value of owner-occupied housing. 
A)  the value of leisure. 
B)  damage to the environment. 
C)  the value of housework. 
D)  the value of owner-occupied housing.

Question 8

An example of investment spending is the:

Accepted Answer

A)  amount of funds raised by the government in the financial markets. 
B)  purchase of government bonds by a private household. 
C)  purchase of a freezer by an ice-cream parlor. 
D)  purchase of stock shares by a mutual fund. 
A)  amount of funds raised by the government in the financial markets. 
B)  purchase of government bonds by a private household. 
C)  purchase of a freezer by an ice-cream parlor. 
D)  purchase of stock shares by a mutual fund.

Question 9

The LARGEST component of U.S. GDP is value added in:

Accepted Answer

A)  household production. 
B)  business production. 
C)  government production. 
D)  production of goods sold overseas. 
A)  household production. 
B)  business production. 
C)  government production. 
D)  production of goods sold overseas.

Question 10

The calculation of aggregate output does NOT include the value of:

Accepted Answer

A)  Firestone tires sold at your local auto shop. 
B)  a new shower installed in a 1920s house. 
C)  the six-CD player replacing the factory-mounted radio-cassette player in your car. 
D)  the tires on brand-new Volvo station wagons. 
A)  Firestone tires sold at your local auto shop. 
B)  a new shower installed in a 1920s house. 
C)  the six-CD player replacing the factory-mounted radio-cassette player in your car. 
D)  the tires on brand-new Volvo station wagons.

Question 11

Use the following to answer questions:  
-(Table: Pizza Economy III) Use Table: Pizza Economy III. Using 2010 as the base year, real GDP in 2010 was:

Accepted Answer

A)  $47,000. 
B)  $69,000. 
C)  $72,000. 
D)  $114,000. 
A)  $47,000. 
B)  $69,000. 
C)  $72,000. 
D)  $114,000.

Question 12

Which item would NOT be included in GDP?

Accepted Answer

A)  the dollar value of a repair job done by your cousin on her own car 
B)  the dollar value of a lawyer's service 
C)  new car sales by a local dealer 
D)  production of new cars that were not sold in the current year 
A)  the dollar value of a repair job done by your cousin on her own car 
B)  the dollar value of a lawyer's service 
C)  new car sales by a local dealer 
D)  production of new cars that were not sold in the current year

Question 13

Suppose that Mr. Green Jeans sells $5,000 of wheat to Big Ben Bakery. Big Ben uses the wheat to make flour and then hamburger buns, which it sells to Hamburger Heaven for $11,000. Hamburger Heaven also buys $20,000 of beef from a rancher. Hamburger Heaven uses the beef and buns to make 10,000 hamburgers, which are sold for $5 each. How much do these transactions add to GDP?

Accepted Answer

A)  $86,000 
B)  $36,000 
C)  $31,000 
D)  $50,000 
A)  $86,000 
B)  $36,000 
C)  $31,000 
D)  $50,000

Question 14

According to the circular-flow diagram, which economic agents engage in consumer spending?

Accepted Answer

A)  firms 
B)  households 
C)  factor markets 
D)  financial markets 
A)  firms 
B)  households 
C)  factor markets 
D)  financial markets

Question 15

Use the following to answer questions:  
-(Figure 7-2: Expanded Circular-Flow Model) Use Figure 7-2: Expanded Circular-Flow Model. How does the government finance its spending?

Accepted Answer

A)  taxes of $150 plus borrowing of $70 
B)  foreign borrowing and sales of stock of $110 
C)  investment spending of $120 
D)  net exports of $80 
A)  taxes of $150 plus borrowing of $70 
B)  foreign borrowing and sales of stock of $110 
C)  investment spending of $120 
D)  net exports of $80

Question 16

In 2011, consumption spending is $7,000, government purchases of goods and services is $2,000, and investment spending is $1,500. If GDP for 2011 is $10,300, exports are _____ and imports are _____.

Accepted Answer

A)  $400; $200 
B)  $100; $200 
C)  $600; $800 
D)  $500; $300 
A)  $400; $200 
B)  $100; $200 
C)  $600; $800 
D)  $500; $300

Question 17

If, during 2010, the Republic of Sildavia recorded investment spending of $3 billion, government purchases of $3 billion, consumer spending of $7 billion, imports of $5 billion, government transfers of $1 billion, and exports of $3 billion, Sildavia's GDP in 2010 was:

Accepted Answer

A)  $11 billion. 
B)  $12 billion. 
C)  $13 billion. 
D)  $14 billion. 
A)  $11 billion. 
B)  $12 billion. 
C)  $13 billion. 
D)  $14 billion.

Question 18

A laptop computer that is purchased by an accounting firm is considered to be:

Accepted Answer

A)  consumption spending. 
B)  investment spending. 
C)  private saving. 
D)  a pretax dividend. 
A)  consumption spending. 
B)  investment spending. 
C)  private saving. 
D)  a pretax dividend.

Question 19

The circular-flow diagram illustrates:

Accepted Answer

A)  the minimum wage state by state. 
B)  fluctuations in exchange rates. 
C)  changes in worker productivity. 
D)  the key concepts in the national accounts. 
A)  the minimum wage state by state. 
B)  fluctuations in exchange rates. 
C)  changes in worker productivity. 
D)  the key concepts in the national accounts.

Question 20

A nation's exports minus its imports:

Accepted Answer

A)  equals its private investment. 
B)  is net exports. 
C)  is always a positive number. 
D)  is equal to net transfer payments. 
A)  equals its private investment. 
B)  is net exports. 
C)  is always a positive number. 
D)  is equal to net transfer payments.

Purchases of _____ are included in GDP.

Domestically produced goods and services sold to people in other countries are known as:

Use the following to answer questions: -(Table: Per Capita GDP) Use Table: Per Capita GDP. The growth rate of per capita real GDP from 2011 to 2014 was:

In the circular-flow diagram, the places where resources, especially capital and labor, are bought and sold are the:

Which example illustrates an intermediate good?

Use the following to answer questions: -(Figure 7-2: Expanded Circular-Flow Model) Use Figure 7-2: Expanded Circular-Flow Model The government has a budget:

GDP does NOT exclude:

An example of investment spending is the:

The LARGEST component of U.S. GDP is value added in:

The calculation of aggregate output does NOT include the value of:

Use the following to answer questions: -(Table: Pizza Economy III) Use Table: Pizza Economy III. Using 2010 as the base year, real GDP in 2010 was:

Which item would NOT be included in GDP?

According to the circular-flow diagram, which economic agents engage in consumer spending?

Use the following to answer questions: -(Figure 7-2: Expanded Circular-Flow Model) Use Figure 7-2: Expanded Circular-Flow Model. How does the government finance its spending?

In 2011, consumption spending is $7,000, government purchases of goods and services is $2,000, and investment spending is $1,500. If GDP for 2011 is $10,300, exports are _ and imports are _.

If, during 2010, the Republic of Sildavia recorded investment spending of $3 billion, government purchases of $3 billion, consumer spending of $7 billion, imports of $5 billion, government transfers of $1 billion, and exports of $3 billion, Sildavia's GDP in 2010 was:

A laptop computer that is purchased by an accounting firm is considered to be:

The circular-flow diagram illustrates:

A nation's exports minus its imports:

First Principles

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial Syst

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Filters

Exam 7: GDP and the CPI: Tracking the Macroeconomy

Purchases of _____ are included in GDP.

Domestically produced goods and services sold to people in other countries are known as:

Use the following to answer questions: -(Table: Per Capita GDP) Use Table: Per Capita GDP. The growth rate of per capita real GDP from 2011 to 2014 was:

In the circular-flow diagram, the places where resources, especially capital and labor, are bought and sold are the:

Which example illustrates an intermediate good?

Use the following to answer questions: -(Figure 7-2: Expanded Circular-Flow Model) Use Figure 7-2: Expanded Circular-Flow Model The government has a budget:

GDP does NOT exclude:

An example of investment spending is the:

The LARGEST component of U.S. GDP is value added in:

The calculation of aggregate output does NOT include the value of:

Use the following to answer questions: -(Table: Pizza Economy III) Use Table: Pizza Economy III. Using 2010 as the base year, real GDP in 2010 was:

Which item would NOT be included in GDP?

According to the circular-flow diagram, which economic agents engage in consumer spending?

Use the following to answer questions: -(Figure 7-2: Expanded Circular-Flow Model) Use Figure 7-2: Expanded Circular-Flow Model. How does the government finance its spending?

In 2011, consumption spending is $7,000, government purchases of goods and services is $2,000, and investment spending is $1,500. If GDP for 2011 is $10,300, exports are _____ and imports are _____.

If, during 2010, the Republic of Sildavia recorded investment spending of $3 billion, government purchases of $3 billion, consumer spending of $7 billion, imports of $5 billion, government transfers of $1 billion, and exports of $3 billion, Sildavia's GDP in 2010 was:

A laptop computer that is purchased by an accounting firm is considered to be:

The circular-flow diagram illustrates:

A nation's exports minus its imports:

First Principles

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial Syst

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Filters

In 2011, consumption spending is $7,000, government purchases of goods and services is $2,000, and investment spending is $1,500. If GDP for 2011 is $10,300, exports are _ and imports are _.