Question 1

To avoid double counting when calculating gross domestic product GDP), it is best to count

Accepted Answer

A)  the value of goods and services produced at every stage of production. 
B)  the value added at each stage of production. 
C)  used goods. 
D)  stocks and bonds. 
E)  all goods and services purchased by consumers, firms, and the government. 
A)  the value of goods and services produced at every stage of production. 
B)  the value added at each stage of production. 
C)  used goods. 
D)  stocks and bonds. 
E)  all goods and services purchased by consumers, firms, and the government.

Question 2

Consider the following data, where gross domestic product (GDP) values are measured in millions of dollars, to answer the next questions:
$$\begin{array} { l l c l } 
\hline \text { Year } & \text { Nominal GDP } & \text { Real GDP } & \text { GDP Deflator } \
\hline 2009 & & \$ 500 & 100 \
2010 & \$ 551.2 & & 106 \
2011 & \$ 600.6 & \$ 546 & \
2012 & & \$ 600.6 & 120 \
\hline
\end{array}$$
-What was the growth rate of nominal gross domestic product GDP) from 2010 to 2011? Round to the nearest second decimal.

Accepted Answer

A)  4.94 percent 
B)  8.96 percent 
C)  8.23 percent 
D)  5.00 percent 
E)  10.00 percent 
A)  4.94 percent 
B)  8.96 percent 
C)  8.23 percent 
D)  5.00 percent 
E)  10.00 percent

Question 3

A company produces a computer. It pays $100 for the keyboard and outer case, $200 for the internal hardware, and $100 for the software. It sells the computer to a consumer for $500. The contribution to gross domestic product GDP) is

Accepted Answer

A)  $400. 
B)  $500. 
C)  $100. 
D)  $900. 
E)  $800. 
A)  $400. 
B)  $500. 
C)  $100. 
D)  $900. 
E)  $800.

Question 4

Consider the following data to answer the next questions:
$$\begin{array} { l l r } 
\hline \text { Country } & \text { GDP } & \text { Population } \
\hline \text { A } & \$ 32,000 & 1,500 \
\text { B } & \$ 20,000 & 1,000 \
\text { C } & \$ 10,000 & 500 \
\text { D } & \$ 10,000 & 2,000 \
\text { E } & \$ 8,000 & 800 \
\hline
\end{array}$$
-Which country has the highest level of gross domestic product GDP) per capita?

Accepted Answer

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

Question 5

Use an equation to explain how the growth of nominal gross domestic product GDP), the growth of real GDP, and the change in price level are related. Give an example.

Accepted Answer

The growth of nominal GDP is approximate

Question 6

A student had the following expenditures last month: rent-$500, food expense-$200, cost of a used textbook from the bookstore-$50, cost of new shoes-$100, and cost of gas for the car-$100. Which of these items are included in gross domestic product GDP)?

Accepted Answer

The rent is included because the landlor

Question 7

Consider the following data, where gross domestic product (GDP) values are measured in millions of dollars, to answer the next questions:
$$\begin{array} { l l c l } 
\hline \text { Year } & \text { Nominal GDP } & \text { Real GDP } & \text { GDP Deflator } \
\hline 2009 & & \$ 500 & 100 \
2010 & \$ 551.2 & & 106 \
2011 & \$ 600.6 & \$ 546 & \
2012 & & \$ 600.6 & 120 \
\hline
\end{array}$$
-What is the value of nominal gross domestic product GDP) in 2009?

Accepted Answer

A)  $50,000 million 
B)  $500 million 
C)  $400 million 
D)  $600 million 
E)  $100 million 
A)  $50,000 million 
B)  $500 million 
C)  $400 million 
D)  $600 million 
E)  $100 million

Question 8

Consider the following figure to answer the next  questions:
 
-In which year was the economy growing at the long-run average growth rate?

Accepted Answer

A)  2001 
B)  2004 
C)  2005 
D)  2009 
E)  2013 
A)  2001 
B)  2004 
C)  2005 
D)  2009 
E)  2013

Question 9

When people in the United States buy clothing made in China, this counts as

Accepted Answer

A)  consumption. 
B)  consumption and exports. 
C)  consumption and imports. 
D)  imports. 
E)  investment. 
A)  consumption. 
B)  consumption and exports. 
C)  consumption and imports. 
D)  imports. 
E)  investment.

Question 10

If nominal gross domestic product GDP) changed by 6 percent and the price level changed by 2 percent, then real GDP changed by

Accepted Answer

A)  4 percent. 
B)  3 percent. 
C)  8 percent. 
D)  12 percent. 
E)  6 percent. 
A)  4 percent. 
B)  3 percent. 
C)  8 percent. 
D)  12 percent. 
E)  6 percent.

Question 11

The gross domestic product GDP) deflator is a measure of

Accepted Answer

A)  price level. 
B)  the growth rate of nominal GDP. 
C)  the growth rate of real GDP. 
D)  the growth rate of long-run trend GDP. 
E)  how much the economy contracts during a recession. 
A)  price level. 
B)  the growth rate of nominal GDP. 
C)  the growth rate of real GDP. 
D)  the growth rate of long-run trend GDP. 
E)  how much the economy contracts during a recession.

Question 12

Real gross domestic product GDP) increases if

Accepted Answer

A)  current prices increase. 
B)  current quantities increase. 
C)  current prices are constant. 
D)  nominal GDP increases. 
E)  nominal GDP decreases. 
A)  current prices increase. 
B)  current quantities increase. 
C)  current prices are constant. 
D)  nominal GDP increases. 
E)  nominal GDP decreases.

Question 13

Nominal gross domestic product (GDP) is GDP measured in____ prices.

Accepted Answer

A)  current 
B)  base 
C)  average 
D)  fixed 
E)  marginal 
A)  current 
B)  base 
C)  average 
D)  fixed 
E)  marginal

Question 14

Consider the following data, which shows the quantities and prices of two goods produced in theeconomy, to answer the next  questions:
$$\begin{array} { l c l } 
\hline & \text { Quantity produced } & \text { Price } \
\hline \text { Cell phones } & 5 \text { million } & \$ 100 / \text { cell phone } \
\text { Pizza } & 25 \text { million } & \$ 10 / \text { pizza } \
\hline
\end{array}$$

-The market value of pizza is

Accepted Answer

A)  $25 million. 
B)  $10 million. 
C)  $2.5 million. 
D)  $250 million. 
E)  $750 million. 
A)  $25 million. 
B)  $10 million. 
C)  $2.5 million. 
D)  $250 million. 
E)  $750 million.

Question 15

Consider the following figure to answer the next  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 16

Company X sells leather to company Y for $60,000. Company Y uses the leather to make shoes, selling them to consumers for $180,000. The total contribution to gross domestic product GDP) is

Accepted Answer

A)  $240,000. 
B)  $180,000. 
C)  $60,000. 
D)  $120,000. 
E)  $30,000. 
A)  $240,000. 
B)  $180,000. 
C)  $60,000. 
D)  $120,000. 
E)  $30,000.

Question 17

Country A has a gross domestic product GDP) of $200,000 and a population of 1,000. Country B has a GDP of $400,000 and a population of 4,000. Which of the following is true?

Accepted Answer

A)  The value of output is higher in country A. 
B)  The value of income is higher in country A. 
C)  The value of GDP per capita is higher in country A. 
D)  The value of GDP per capita is higher in country B. 
E)  The average living standard is higher in country B. 
A)  The value of output is higher in country A. 
B)  The value of income is higher in country A. 
C)  The value of GDP per capita is higher in country A. 
D)  The value of GDP per capita is higher in country B. 
E)  The average living standard is higher in country B.

Question 18

Consider the following data to answer the next questions:
$$\begin{array} { l l r } 
\hline \text { Country } & \text { GDP } & \text { Population } \
\hline \text { A } & \$ 32,000 & 1,500 \
\text { B } & \$ 20,000 & 1,000 \
\text { C } & \$ 10,000 & 500 \
\text { D } & \$ 10,000 & 2,000 \
\text { E } & \$ 8,000 & 800 \
\hline
\end{array}$$
-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 19

The gross domestic product GDP) deflator is a measure of the price level that includes prices of

Accepted Answer

A)  consumer goods and services only. 
B)  producer goods and services only. 
C)  final and intermediate goods and services. 
D)  final goods and services. 
E)  final services only. 
A)  consumer goods and services only. 
B)  producer goods and services only. 
C)  final and intermediate goods and services. 
D)  final goods and services. 
E)  final services only.

Question 20

A shortcoming of real gross domestic product GDP) is it

Accepted Answer

A)  does not include the underground economy. 
B)  includes nonmarket goods. 
C)  does not measure changes in employment. 
D)  does not include the value obtained through purchases of stocks and bonds. 
E)  does not account for changes in the prices of goods and services. 
A)  does not include the underground economy. 
B)  includes nonmarket goods. 
C)  does not measure changes in employment. 
D)  does not include the value obtained through purchases of stocks and bonds. 
E)  does not account for changes in the prices of goods and services.

To avoid double counting when calculating gross domestic product GDP), it is best to count

A company produces a computer. It pays $100 for the keyboard and outer case, $200 for the internal hardware, and $100 for the software. It sells the computer to a consumer for $500. The contribution to gross domestic product GDP) is

Consider the following data to answer the next questions: Country GDP Population A \ 32,000 1,500 B \ 20,000 1,000 C \ 10,000 500 D \ 10,000 2,000 E \ 8,000 800 -Which country has the highest level of gross domestic product GDP) per capita?

Use an equation to explain how the growth of nominal gross domestic product GDP), the growth of real GDP, and the change in price level are related. Give an example.

A student had the following expenditures last month: rent-$500, food expense-$200, cost of a used textbook from the bookstore-$50, cost of new shoes-$100, and cost of gas for the car-$100. Which of these items are included in gross domestic product GDP)?

Consider the following figure to answer the next questions: -In which year was the economy growing at the long-run average growth rate?

When people in the United States buy clothing made in China, this counts as

If nominal gross domestic product GDP) changed by 6 percent and the price level changed by 2 percent, then real GDP changed by

The gross domestic product GDP) deflator is a measure of

Real gross domestic product GDP) increases if

Nominal gross domestic product (GDP) is GDP measured in____ prices.

Consider the following data, which shows the quantities and prices of two goods produced in theeconomy, to answer the next questions: Quantity produced Price Cell phones 5 million \ 100/ cell phone Pizza 25 million \ 10/ pizza -The market value of pizza is

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

Company X sells leather to company Y for $60,000. Company Y uses the leather to make shoes, selling them to consumers for $180,000. The total contribution to gross domestic product GDP) is

Country A has a gross domestic product GDP) of $200,000 and a population of 1,000. Country B has a GDP of $400,000 and a population of 4,000. Which of the following is true?

Consider the following data to answer the next questions: Country GDP Population A \ 32,000 1,500 B \ 20,000 1,000 C \ 10,000 500 D \ 10,000 2,000 E \ 8,000 800 -Which two countries have the same average living standard?

The gross domestic product GDP) deflator is a measure of the price level that includes prices of

A shortcoming of real gross domestic product GDP) is it

Five Foundations of Economics

Model Building and Gains From Trade

The Market at Work: Supply and Demand Y

Market Outcomes and Tax Incidence

Price Controls

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

Recessions, Expansions, and the Debate Over How to Manage Them

Federal Budgets: the Tools of Fiscal Policy

Fiscal Policy

Money and the Federal Reserve

Monetary Policy

International Trade

International Finance

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Exam 6: Introduction to Macroeconomics and Gross Domestic Product

To avoid double counting when calculating gross domestic product GDP), it is best to count

A company produces a computer. It pays $100 for the keyboard and outer case, $200 for the internal hardware, and $100 for the software. It sells the computer to a consumer for $500. The contribution to gross domestic product GDP) is

Consider the following data to answer the next questions: Country GDP Population A \ 32,000 1,500 B \ 20,000 1,000 C \ 10,000 500 D \ 10,000 2,000 E \ 8,000 800 -Which country has the highest level of gross domestic product GDP) per capita?

Use an equation to explain how the growth of nominal gross domestic product GDP), the growth of real GDP, and the change in price level are related. Give an example.

A student had the following expenditures last month: rent-$500, food expense-$200, cost of a used textbook from the bookstore-$50, cost of new shoes-$100, and cost of gas for the car-$100. Which of these items are included in gross domestic product GDP)?

Consider the following figure to answer the next questions: -In which year was the economy growing at the long-run average growth rate?

When people in the United States buy clothing made in China, this counts as

If nominal gross domestic product GDP) changed by 6 percent and the price level changed by 2 percent, then real GDP changed by

The gross domestic product GDP) deflator is a measure of

Real gross domestic product GDP) increases if

Nominal gross domestic product (GDP) is GDP measured in____ prices.

Consider the following data, which shows the quantities and prices of two goods produced in theeconomy, to answer the next questions: Quantity produced Price Cell phones 5 million \ 100/ cell phone Pizza 25 million \ 10/ pizza -The market value of pizza is

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

Company X sells leather to company Y for $60,000. Company Y uses the leather to make shoes, selling them to consumers for $180,000. The total contribution to gross domestic product GDP) is

Country A has a gross domestic product GDP) of $200,000 and a population of 1,000. Country B has a GDP of $400,000 and a population of 4,000. Which of the following is true?

Consider the following data to answer the next questions: Country GDP Population A \ 32,000 1,500 B \ 20,000 1,000 C \ 10,000 500 D \ 10,000 2,000 E \ 8,000 800 -Which two countries have the same average living standard?

The gross domestic product GDP) deflator is a measure of the price level that includes prices of

A shortcoming of real gross domestic product GDP) is it

Five Foundations of Economics

Model Building and Gains From Trade

The Market at Work: Supply and Demand Y

Market Outcomes and Tax Incidence

Price Controls

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

Recessions, Expansions, and the Debate Over How to Manage Them

Federal Budgets: the Tools of Fiscal Policy

Fiscal Policy

Money and the Federal Reserve

Monetary Policy

International Trade

International Finance

Filters