Question 1

If nominal GDP is $10 trillion and real GDP is $8 trillion,then the GDP deflator is

Accepted Answer

A)  80,and this indicates that the price level has decreased by 20 percent since the base year. 
B)  80,and this indicates that the price level has increased by 80 percent since the base year. 
C)  125,and this indicates that the price level has increased by 25 percent since the base year. 
D)  125,and this indicates that the price level has increased by 125 percent since the base year. 
A)  80,and this indicates that the price level has decreased by 20 percent since the base year. 
B)  80,and this indicates that the price level has increased by 80 percent since the base year. 
C)  125,and this indicates that the price level has increased by 25 percent since the base year. 
D)  125,and this indicates that the price level has increased by 125 percent since the base year.

Question 2

If nominal GDP is $10 trillion and real GDP is $12 trillion,then the GDP deflator is

Accepted Answer

A)  83.33,and this indicates that the price level has decreased by 16.67 percent since the base year. 
B)  83.33,and this indicates that the price level has increased by 83.33 percent since the base year. 
C)  120,and this indicates that the price level has increased by 20 percent since the base year. 
D)  120,and this indicates that the price level has increased by 120 percent since the base year. 
A)  83.33,and this indicates that the price level has decreased by 16.67 percent since the base year. 
B)  83.33,and this indicates that the price level has increased by 83.33 percent since the base year. 
C)  120,and this indicates that the price level has increased by 20 percent since the base year. 
D)  120,and this indicates that the price level has increased by 120 percent since the base year.

Question 3

A recession is always associated with

Accepted Answer

A)  the end of a war. 
B)  slowly growing real GDP. 
C)  rising inflation. 
D)  declining real GDP. 
A)  the end of a war. 
B)  slowly growing real GDP. 
C)  rising inflation. 
D)  declining real GDP.

Question 4

A German citizen buys an automobile produced in the United States by a Japanese company.As a result,

Accepted Answer

A)  U.S.net exports increase,U.S.GDP is unaffected,Japanese GNP increases,German net exports decrease,and German GNP and GDP are unaffected. 
B)  U.S.net exports and GDP increase,Japanese GNP increases,German net exports decrease,German GNP is unaffected,and German GDP decreases. 
C)  U.S.net exports and GDP increase,Japanese GNP increases,German net exports decrease,and German GNP and GDP are unaffected. 
D)  U.S.net exports and GDP are unaffected,Japanese GNP increases,and German net exports,GNP,and GDP decrease. 
A)  U.S.net exports increase,U.S.GDP is unaffected,Japanese GNP increases,German net exports decrease,and German GNP and GDP are unaffected. 
B)  U.S.net exports and GDP increase,Japanese GNP increases,German net exports decrease,German GNP is unaffected,and German GDP decreases. 
C)  U.S.net exports and GDP increase,Japanese GNP increases,German net exports decrease,and German GNP and GDP are unaffected. 
D)  U.S.net exports and GDP are unaffected,Japanese GNP increases,and German net exports,GNP,and GDP decrease.

Question 5

GDP excludes most of two types of production.List one.

Accepted Answer

GDP excludes most items that a

Question 6

Which of the following items is included in U.S.GDP?

Accepted Answer

A)  goods produced by foreign citizens working in the United States 
B)  the difference in the price of the sale of an existing home and its original purchase price 
C)  known illegal activities 
D)  None of the above is included in U.S.GDP. 
A)  goods produced by foreign citizens working in the United States 
B)  the difference in the price of the sale of an existing home and its original purchase price 
C)  known illegal activities 
D)  None of the above is included in U.S.GDP.

Question 7

Which of the following is included in GDP?

Accepted Answer

A)  medical marijuana purchased from a government-run pharmacy by a glaucoma patient 
B)  recreational marijuana purchased from a drug dealer by a college student 
C)  recreational marijuana produced and consumed by a man in his attic 
D)  All of the above are included in GDP. 
A)  medical marijuana purchased from a government-run pharmacy by a glaucoma patient 
B)  recreational marijuana purchased from a drug dealer by a college student 
C)  recreational marijuana produced and consumed by a man in his attic 
D)  All of the above are included in GDP.

Question 8

Transactions involving items produced in the past,such as the sale of a 5-year-old automobile by a used car dealership or the purchase of an antique rocking chair by a person at a yard sale,are

Accepted Answer

A)  included in current GDP because GDP measures the value of all goods and services sold in the current year. 
B)  included in current GDP but valued at their original prices. 
C)  not included in current GDP because it is difficult to determine their value. 
D)  not included in current GDP because GDP only measures the value of goods and services produced in the current year. 
A)  included in current GDP because GDP measures the value of all goods and services sold in the current year. 
B)  included in current GDP but valued at their original prices. 
C)  not included in current GDP because it is difficult to determine their value. 
D)  not included in current GDP because GDP only measures the value of goods and services produced in the current year.

Question 9

In the economy of Ukzten in 2010,consumption was $4000,exports were $800,GDP was $9500,imports were $200,and investment was $1000.What were Ukzten's government purchases in 2010?

Accepted Answer

A)  $3700 
B)  $3900 
C)  $5100 
D)  $5500 
A)  $3700 
B)  $3900 
C)  $5100 
D)  $5500

Question 10

Table 10-1
The table below contains data for country A for the year 2010.
  
-Refer to Table 10-1.What was country A's investment in 2010?

Accepted Answer

A)  $1178 
B)  $1295 
C)  $1882 
D)  $1999 
A)  $1178 
B)  $1295 
C)  $1882 
D)  $1999

Question 11

Table 10-2
The table below contains data for the country of Crete for the year 2010.
  
-Refer to Table 10-2.What was Crete's investment in 2010?

Accepted Answer

A)  $675 
B)  $1090 
C)  $1491 
D)  $1793 
A)  $675 
B)  $1090 
C)  $1491 
D)  $1793

Question 12

Table 10-1
The table below contains data for country A for the year 2010.
  
-Refer to Table 10-1.What were country A's exports in 2010?

Accepted Answer

A)  -$32 
B)  $32 
C)  $88 
D)  $120 
A)  -$32 
B)  $32 
C)  $88 
D)  $120

Question 13

Table 10-2
The table below contains data for the country of Crete for the year 2010.
  
-Refer to Table 10-2.What were Crete's government purchases in 2010?

Accepted Answer

A)  $1130 
B)  $1601 
C)  $1837 
D)  $2544 
A)  $1130 
B)  $1601 
C)  $1837 
D)  $2544

Question 14

GDP includes the value of paper clips but does not also count the value of the metal used to make them.

Accepted Answer

A) True 
 B)False

Question 15

Countries with low GDP per person tend to have

Accepted Answer

A)  lower rates of child malnutrition. 
B)  fewer infants with low birth weight. 
C)  higher rates of infant mortality. 
D)  more access to safe drinking water. 
A)  lower rates of child malnutrition. 
B)  fewer infants with low birth weight. 
C)  higher rates of infant mortality. 
D)  more access to safe drinking water.

Question 16

A good is produced by a firm in 2010,added to the firm's inventory in 2010,and sold to a household in 2011.It follows that

Accepted Answer

A)  the value of the good is added to the investment category of 2010 GDP,added to the consumption category of 2011 GDP,and subtracted from the investment category of 2011 GDP. 
B)  the value of the good is added to the investment category of 2010 GDP,added to the consumption category of 2011 GDP,and not included in the investment category of 2011 GDP. 
C)  the value of the good is added to the investment category of 2010 GDP,subtracted from the consumption category of 2011 GDP,and not included in the investment category of 2011 GDP. 
D)  the value of the good is added to the investment category of 2010 GDP,subtracted from the consumption category of 2011 GDP,and added to the investment category of 2011 GDP. 
A)  the value of the good is added to the investment category of 2010 GDP,added to the consumption category of 2011 GDP,and subtracted from the investment category of 2011 GDP. 
B)  the value of the good is added to the investment category of 2010 GDP,added to the consumption category of 2011 GDP,and not included in the investment category of 2011 GDP. 
C)  the value of the good is added to the investment category of 2010 GDP,subtracted from the consumption category of 2011 GDP,and not included in the investment category of 2011 GDP. 
D)  the value of the good is added to the investment category of 2010 GDP,subtracted from the consumption category of 2011 GDP,and added to the investment category of 2011 GDP.

Question 17

In the equation Y = C + I + G + NX,

Accepted Answer

A)  Y represents the economy's total expenditure. 
B)  C represents household expenditures on services and durable goods. 
C)  all of the variables are always positive numbers. 
D)  All of the above are correct. 
A)  Y represents the economy's total expenditure. 
B)  C represents household expenditures on services and durable goods. 
C)  all of the variables are always positive numbers. 
D)  All of the above are correct.

Question 18

Foreign countries buy $1.2 trillion of U.S.goods and services.U.S.residents purchase $1.8 trillion of foreign goods and services.What is net exports?

Accepted Answer

The answer of Foreign countries buy $1.2 trillion of U.S.goods...

Question 19

Which of the following represents a transfer payment?

Accepted Answer

A)  You transfer $1,000 from your bank account to a mutual fund. 
B)  The government sends your grandfather his Social Security check. 
C)  You make a payment to get legal documents showing you purchased a previously owned home. 
D)  Your employer automatically transfers $100 each month from your wages to a non-taxable medical spending account. 
A)  You transfer $1,000 from your bank account to a mutual fund. 
B)  The government sends your grandfather his Social Security check. 
C)  You make a payment to get legal documents showing you purchased a previously owned home. 
D)  Your employer automatically transfers $100 each month from your wages to a non-taxable medical spending account.

Question 20

Which of the following is included in government purchases?

Accepted Answer

A)  unemployment benefits a state pays 
B)  Social Security payments the U.S.government makes 
C)  the services of a U.S.government attorney valued at the cost of her salary 
D)  All of the above are correct. 
A)  unemployment benefits a state pays 
B)  Social Security payments the U.S.government makes 
C)  the services of a U.S.government attorney valued at the cost of her salary 
D)  All of the above are correct.

Exam 23: Measuring a Nations Income

If nominal GDP is $10 trillion and real GDP is $8 trillion,then the GDP deflator is

If nominal GDP is $10 trillion and real GDP is $12 trillion,then the GDP deflator is

A recession is always associated with

A German citizen buys an automobile produced in the United States by a Japanese company.As a result,

GDP excludes most of two types of production.List one.

Which of the following items is included in U.S.GDP?

Which of the following is included in GDP?

Transactions involving items produced in the past,such as the sale of a 5-year-old automobile by a used car dealership or the purchase of an antique rocking chair by a person at a yard sale,are

In the economy of Ukzten in 2010,consumption was $4000,exports were $800,GDP was $9500,imports were $200,and investment was $1000.What were Ukzten's government purchases in 2010?

Table 10-1 The table below contains data for country A for the year 2010. -Refer to Table 10-1.What was country A's investment in 2010?

Table 10-2 The table below contains data for the country of Crete for the year 2010. -Refer to Table 10-2.What was Crete's investment in 2010?

Table 10-1 The table below contains data for country A for the year 2010. -Refer to Table 10-1.What were country A's exports in 2010?

Table 10-2 The table below contains data for the country of Crete for the year 2010. -Refer to Table 10-2.What were Crete's government purchases in 2010?

GDP includes the value of paper clips but does not also count the value of the metal used to make them.

Countries with low GDP per person tend to have

A good is produced by a firm in 2010,added to the firm's inventory in 2010,and sold to a household in 2011.It follows that

In the equation Y = C + I + G + NX,

Foreign countries buy $1.2 trillion of U.S.goods and services.U.S.residents purchase $1.8 trillion of foreign goods and services.What is net exports?

Which of the following represents a transfer payment?

Which of the following is included in government purchases?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply,demand,and Government Policies

Consumers,producers,and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Market for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring the Cost of Living

Production and Growth

Saving,investment,and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomic Models

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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