Question 1

Which of the following is a category of national income?

Accepted Answer

A)  net interest 
B)  corporate profits 
C)  rental income 
D)  all of the above 
A)  net interest 
B)  corporate profits 
C)  rental income 
D)  all of the above

Question 2

Which of the following is a macroeconomic statement?

Accepted Answer

A)  Motorcycle manufacturer productivity decreased by three percent in 2012. 
B)  The price of cell phones decreased by 18 percent last year. 
C)  Real domestic output of seafood increased 12 percent from 2011 to 2012. 
D)  The U.S. inflation rate was two percent in 2012. 
A)  Motorcycle manufacturer productivity decreased by three percent in 2012. 
B)  The price of cell phones decreased by 18 percent last year. 
C)  Real domestic output of seafood increased 12 percent from 2011 to 2012. 
D)  The U.S. inflation rate was two percent in 2012.

Question 3

Recall the Application about the link between happiness and GDP to answer the following question(s). Comparing changes in happiness to changes in per capita income over the last 30 years, economists at Dartmouth College and Warwick University have measured levels of happiness in the United States and United Kingdom based on income levels, ethnicity, age, and gender.
-According to the Application

Accepted Answer

A)  reported levels of happiness in the United States have increased over the past 30 years. 
B)  stable marriages account for no more happiness than marriages ending in divorce. 
C)  retired people report higher levels of happiness than people below the age of 40. 
D)  money does appear to buy happiness, ceteris paribus. 
A)  reported levels of happiness in the United States have increased over the past 30 years. 
B)  stable marriages account for no more happiness than marriages ending in divorce. 
C)  retired people report higher levels of happiness than people below the age of 40. 
D)  money does appear to buy happiness, ceteris paribus.

Question 4

"Recession" refers to a period when real GDP in the economy

Accepted Answer

A)  declines for at least six months. 
B)  suffers due to political instability. 
C)  grows rapidly. 
D)  experiences a rise in living standards. 
A)  declines for at least six months. 
B)  suffers due to political instability. 
C)  grows rapidly. 
D)  experiences a rise in living standards.

Question 5

For the purpose of GDP accounting, consumption expenditures include

Accepted Answer

A)  only nondurable goods. 
B)  only durable goods. 
C)  both nondurable goods and services. 
D)  durable goods, nondurable goods, and services. 
A)  only nondurable goods. 
B)  only durable goods. 
C)  both nondurable goods and services. 
D)  durable goods, nondurable goods, and services.

Question 6

In a business cycle, the date at which a recession starts is called a trough.

Accepted Answer

A) True 
 B)False

Question 7

Income that flows to the private sector for services and production, is called

Accepted Answer

A)  net income. 
B)  national income. 
C)  deficit income. 
D)  derived income. 
A)  net income. 
B)  national income. 
C)  deficit income. 
D)  derived income.

Question 8

The four components of GDP are consumption expenditures, private investment expenditures, government purchases, and transfer payments.

Accepted Answer

A) True 
 B)False

Question 9

From World War II through 2010, the United States experienced ________ recessions.

Accepted Answer

A)  2 
B)  5 
C)  11 
D)  15 
A)  2 
B)  5 
C)  11 
D)  15

Question 10

A nation's net exports consist of

Accepted Answer

A)  its exports plus its imports. 
B)  its exports minus its imports. 
C)  its exports plus all other nation's imports. 
D)  its imports plus all other nation's exports. 
A)  its exports plus its imports. 
B)  its exports minus its imports. 
C)  its exports plus all other nation's imports. 
D)  its imports plus all other nation's exports.

Question 11

Depreciation is subtracted from GNP to determine

Accepted Answer

A)  net income. 
B)  net national product (NNP). 
C)  net GDP. 
D)  net imbalance on exports. 
A)  net income. 
B)  net national product (NNP). 
C)  net GDP. 
D)  net imbalance on exports.

Question 12

Recall the Application about the time it took to recover from the recession of 2007-2009 to answer the following question(s).
-According to this Application, some economists believe that the economy was slow to recover from the recession of 2007-2009 because this recession was brought on primarily by

Accepted Answer

A)  a decrease in the demand for housing. 
B)  rapid inflation. 
C)  increasing oil prices. 
D)  a financial crisis. 
A)  a decrease in the demand for housing. 
B)  rapid inflation. 
C)  increasing oil prices. 
D)  a financial crisis.

Question 13

"Final goods and services" are those that are

Accepted Answer

A)  produced outside the United States. 
B)  used in the production of other goods and services. 
C)  double counted in the calculation of GDP. 
D)  sold to ultimate or final purchasers. 
A)  produced outside the United States. 
B)  used in the production of other goods and services. 
C)  double counted in the calculation of GDP. 
D)  sold to ultimate or final purchasers.

Question 14

Use the following information to answer the next several questions:
Scenario 1: Imagine that an economy produces two goods, flashlights and fishing lures. In 2011, the economy produced 70 flashlights and 40 fishing lures, and the prices of flashlights and fishing lures were $5 and $12, respectively. In 2012, the economy produced 85 flashlights and 50 fishing lures, and the prices of flashlights and fishing lures were $7 and $15, respectively.
-Based on the information in Scenario 1, real GDP in 2012 (in 2011 dollars)in this economy was

Accepted Answer

A)  $830. 
B)  $1,025. 
C)  $1,090. 
D)  $1,345. 
A)  $830. 
B)  $1,025. 
C)  $1,090. 
D)  $1,345.

Question 15

The value of all final goods and services produced during a given time period measures a nation's

Accepted Answer

A)  gross domestic product. 
B)  net national product. 
C)  consumer price index. 
D)  net exports. 
A)  gross domestic product. 
B)  net national product. 
C)  consumer price index. 
D)  net exports.

Question 16

A "trade deficit" occurs when

Accepted Answer

A)  we sell more to other countries than we buy from them. 
B)  we buy more from other countries than we sell to them. 
C)  we sell more to one country than another. 
D)  we sell less to one country than another. 
A)  we sell more to other countries than we buy from them. 
B)  we buy more from other countries than we sell to them. 
C)  we sell more to one country than another. 
D)  we sell less to one country than another.

Question 17

The GDP deflator measures how prices change over time.

Accepted Answer

A) True 
 B)False

Question 18

Give some examples of transactions in markets which are not regulated or controlled.

Accepted Answer

services such as cleaning, coo

Question 19

The largest component of GDP is

Accepted Answer

A)  government spending. 
B)  consumption expenditures. 
C)  private investment expenditures. 
D)  net exports. 
A)  government spending. 
B)  consumption expenditures. 
C)  private investment expenditures. 
D)  net exports.

Question 20

List and describe the four components of GDP.

Accepted Answer

Consumption expenditures are purchases b

Which of the following is a category of national income?

Which of the following is a macroeconomic statement?

"Recession" refers to a period when real GDP in the economy

For the purpose of GDP accounting, consumption expenditures include

In a business cycle, the date at which a recession starts is called a trough.

Income that flows to the private sector for services and production, is called

The four components of GDP are consumption expenditures, private investment expenditures, government purchases, and transfer payments.

From World War II through 2010, the United States experienced ________ recessions.

A nation's net exports consist of

Depreciation is subtracted from GNP to determine

"Final goods and services" are those that are

The value of all final goods and services produced during a given time period measures a nation's

A "trade deficit" occurs when

The GDP deflator measures how prices change over time.

Give some examples of transactions in markets which are not regulated or controlled.

The largest component of GDP is

List and describe the four components of GDP.

Introduction: What Is Economics?

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Unemployment and Inflation

The Economy at Full Employment

Why Do Economies Grow?

Aggregate Demand and Aggregate Supply

Fiscal Policy

The Income-Expenditure Model

Investment and Financial Markets

Money and the Banking System

The Federal Reserve and Monetary Policy

Modern Macroeconomics: From the Short Run to the Long Run

The Dynamics of Inflation and Unemployment

Macroeconomic Policy Debates

International Trade and Public Policy

The World of International Finance

Filters

Exam 5: Measuring a Nation's Production and Income

Which of the following is a category of national income?

Which of the following is a macroeconomic statement?

"Recession" refers to a period when real GDP in the economy

For the purpose of GDP accounting, consumption expenditures include

In a business cycle, the date at which a recession starts is called a trough.

Income that flows to the private sector for services and production, is called

The four components of GDP are consumption expenditures, private investment expenditures, government purchases, and transfer payments.

From World War II through 2010, the United States experienced ________ recessions.

A nation's net exports consist of

Depreciation is subtracted from GNP to determine

"Final goods and services" are those that are

The value of all final goods and services produced during a given time period measures a nation's

A "trade deficit" occurs when

The GDP deflator measures how prices change over time.

Give some examples of transactions in markets which are not regulated or controlled.

The largest component of GDP is

List and describe the four components of GDP.

Introduction: What Is Economics?

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Unemployment and Inflation

The Economy at Full Employment

Why Do Economies Grow?

Aggregate Demand and Aggregate Supply

Fiscal Policy

The Income-Expenditure Model

Investment and Financial Markets

Money and the Banking System

The Federal Reserve and Monetary Policy

Modern Macroeconomics: From the Short Run to the Long Run

The Dynamics of Inflation and Unemployment

Macroeconomic Policy Debates

International Trade and Public Policy

The World of International Finance

Filters