Question 1

Over the last few decades, Americans have chosen to cook less at home and eat more at restaurants. This change in behavior, by itself, has

Accepted Answer

A) reduced measured GDP. 
B) not affected measured GDP. 
C) increased measured GDP by the value of the restaurant meals. 
D) increased measured GDP by the value added by the restaurant's preparation and serving of the meals. 
A) reduced measured GDP. 
B) not affected measured GDP. 
C) increased measured GDP by the value of the restaurant meals. 
D) increased measured GDP by the value added by the restaurant's preparation and serving of the meals.

Question 2

Figure 23-1  
-Refer to Figure 23-1. Which of the following pairs correctly identify W and Y?

Accepted Answer

A) Markets for factors of production and markets for goods and services 
B) Firms and households 
C) Expenditures and income 
D) Consumption and investment 
A) Markets for factors of production and markets for goods and services 
B) Firms and households 
C) Expenditures and income 
D) Consumption and investment

Question 3

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

Accepted Answer

GDP excludes most items that a

Question 4

In 2010 a country had nominal GDP of 6 trillion euro and real GDP of 5 trillion euro. In 2011 it had nominal GDP of 6.5 trillion euro and real GDP of 5.2 trillion euro. What was its inflation rate in 2011? Show your work.

Accepted Answer

The GDP deflator for 2010 was

Question 5

Expenditures by households on education are included in the investment component of GDP.

Accepted Answer

A) True 
 B)False

Question 6

Table 23-2
The following table contains data for country Mindalion for the year 2019.
​
 $$\begin{array} { | l | l | } 
\hline \text { Household purchases of durable goods } & \$ 1,695 \
\hline \text { Household purchases of nondurable goods } & \$ 1,717 \
\hline \text { Household purchases of services } & \$ 400 \
\hline \text { Household purchases of new housing } & \$ 704 \
\hline \text { Purchases of capital equipment } & \$ 310 \
\hline \text { Inventory changes } & \$ 399 \
\hline \text { Purchases of new structures } & \$ 611 \
\hline \text { Depreciati on } & \$ 117 \
\hline \text { Salaries of government workers } & \$ 1,422 \
\hline \text { Government expenditures on public works } & \$ 589 \
\hline \text { Transfer payments } & \$ 777 \
\hline \text { Foreign purchases of domestically produced goods } & \$ 88 \
\hline \text { Domestic purchases of foreign goods } & \$ 140 \
\hline
\end{array}$$
-Refer to Table 23-2. What was country Mindalion's investment in 2019?

Accepted Answer

A) $2,011 
B) $2,024 
C) $3,812 
D) $7,795 
A) $2,011 
B) $2,024 
C) $3,812 
D) $7,795

Question 7

GDP can measure either the total income of everyone in the economy or the total expenditure on the economy's output of goods and services, but GDP cannot measure both at the same time.

Accepted Answer

A) True 
 B)False

Question 8

Net exports equal

Accepted Answer

A) exports plus imports. 
B) imports minus exports. 
C) Y − (C + I + G). 
D) Y − (C − I − G). 
A) exports plus imports. 
B) imports minus exports. 
C) Y − (C + I + G). 
D) Y − (C − I − G).

Question 9

Table 23-2
The following table contains data for country Mindalion for the year 2019.
​
 $$\begin{array} { | l | l | } 
\hline \text { Household purchases of durable goods } & \$ 1,695 \
\hline \text { Household purchases of nondurable goods } & \$ 1,717 \
\hline \text { Household purchases of services } & \$ 400 \
\hline \text { Household purchases of new housing } & \$ 704 \
\hline \text { Purchases of capital equipment } & \$ 310 \
\hline \text { Inventory changes } & \$ 399 \
\hline \text { Purchases of new structures } & \$ 611 \
\hline \text { Depreciati on } & \$ 117 \
\hline \text { Salaries of government workers } & \$ 1,422 \
\hline \text { Government expenditures on public works } & \$ 589 \
\hline \text { Transfer payments } & \$ 777 \
\hline \text { Foreign purchases of domestically produced goods } & \$ 88 \
\hline \text { Domestic purchases of foreign goods } & \$ 140 \
\hline
\end{array}$$
-Refer to Table 23-2. What were country Mindalion's net exports in 2019?

Accepted Answer

A) ?$52 
B) $52 
C) $88 
D) $140 
A) ?$52 
B) $52 
C) $88 
D) $140

Question 10

The advantage of real GDP as a measure is the fact that it only increases.
​

Accepted Answer

A) True 
 B)False

Question 11

The GDP deflator can be used to take inflation out of nominal GDP.

Accepted Answer

A) True 
 B)False

Question 12

Consumption is $5.5 trillion, investment is $1 trillion, government expenditures are $1.5 trillion, transfer payments are $.5 trillion, exports are $.75 trillion and imports are $1.25 trillion. What is GDP?

Accepted Answer

GDP = C + I + G + NX = $5.5 tr

Question 13

If someone in the United States buys a surfboard produced in Australia, then that purchase is included in both the consumption component of U.S. GDP and the net exports component of U.S. GDP.

Accepted Answer

A) True 
 B)False

Question 14

The GDP deflator is the ratio of

Accepted Answer

A) real GDP to nominal GDP multiplied by 100. 
B) real GDP to the inflation rate multiplied by 100. 
C) nominal GDP to real GDP multiplied by 100. 
D) nominal GDP to the inflation rate multiplied by 100. 
A) real GDP to nominal GDP multiplied by 100. 
B) real GDP to the inflation rate multiplied by 100. 
C) nominal GDP to real GDP multiplied by 100. 
D) nominal GDP to the inflation rate multiplied by 100.

Question 15

The government purchases component of GDP includes salaries paid to soldiers but not Social Security benefits paid to the elderly.

Accepted Answer

A) True 
 B)False

Question 16

A country reported nominal GDP of $35 billion in 2016 and $55 billion in 2015. It also reported a GDP deflator of 105 in 2016 and 115 in 2015. Between 2015 and 2016,

Accepted Answer

A) real output and the price level both fell. 
B) real output fell and the price level rose. 
C) real output rose and the price level fell. 
D) real output and the price level both rose. 
A) real output and the price level both fell. 
B) real output fell and the price level rose. 
C) real output rose and the price level fell. 
D) real output and the price level both rose.

Question 17

Table 23-7
A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year.
 $$\begin{array} { | l | l | l | l | l | } 
\hline \text { Year } & \begin{array} { l } 
\text { Price of Ice } \
\text { Cream }
\end{array} & \begin{array} { l } 
\text { Quantity of Ice } \
\text { Cream }
\end{array} & \text { Price of Cake } & \begin{array} { l } 
\text { Quantity of } \
\text { Cake }
\end{array} \
\hline 2011 & \$ 2.00 & 200 & \$ 10 & 40 \
\hline 2012 & \$ 2.30 & 250 & \$ 14 & 50 \
\hline 2013 & \$ 2.75 & 280 & \$ 18 & 80 \
\hline
\end{array}$$
-Refer to Table 23-7. Calculate the GDP deflator for 2012 and 2013.

Accepted Answer

GDP deflator is 127.

Question 18

​GDP and GNP are identical when

Accepted Answer

A) exports and imports exactly balance. 
B) ​all domestic production is by domestically owned producers and no foreign production is carried out by domestic producers. 
C) ​production by domestic producers in other countries is greater than production by foreign producers domestically. 
D) ​there are no taxes. 
A) exports and imports exactly balance. 
B) ​all domestic production is by domestically owned producers and no foreign production is carried out by domestic producers. 
C) ​production by domestic producers in other countries is greater than production by foreign producers domestically. 
D) ​there are no taxes.

Question 19

Calculate GDP for an economy with exports of $5 trillion, investment of $1.5 trillion, consumption spending of $11 trillion, imports of $6 trillion, and government purchases of $3 trillion.

Accepted Answer

The answer of Calculate GDP for an economy with exports...

Question 20

Table 23-6
The country of Batavia produces only chocolates and watches. Below is a table with recent information on Batavia production and prices. The base year is 2009.
Prices and Quantities
  
-Refer to Table 23-6. What was nominal GDP, real GDP, and the GDP deflator for 2009? Show your work.

Accepted Answer

Nominal GDP was $5x90 + $50x15

Exam 23: Measuring a Nations Income

Over the last few decades, Americans have chosen to cook less at home and eat more at restaurants. This change in behavior, by itself, has

Figure 23-1 -Refer to Figure 23-1. Which of the following pairs correctly identify W and Y?

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

In 2010 a country had nominal GDP of 6 trillion euro and real GDP of 5 trillion euro. In 2011 it had nominal GDP of 6.5 trillion euro and real GDP of 5.2 trillion euro. What was its inflation rate in 2011? Show your work.

Expenditures by households on education are included in the investment component of GDP.

GDP can measure either the total income of everyone in the economy or the total expenditure on the economy's output of goods and services, but GDP cannot measure both at the same time.

Net exports equal

The advantage of real GDP as a measure is the fact that it only increases. ​

The GDP deflator can be used to take inflation out of nominal GDP.

Consumption is $5.5 trillion, investment is $1 trillion, government expenditures are $1.5 trillion, transfer payments are $.5 trillion, exports are $.75 trillion and imports are $1.25 trillion. What is GDP?

If someone in the United States buys a surfboard produced in Australia, then that purchase is included in both the consumption component of U.S. GDP and the net exports component of U.S. GDP.

The GDP deflator is the ratio of

The government purchases component of GDP includes salaries paid to soldiers but not Social Security benefits paid to the elderly.

A country reported nominal GDP of $35 billion in 2016 and $55 billion in 2015. It also reported a GDP deflator of 105 in 2016 and 115 in 2015. Between 2015 and 2016,

​GDP and GNP are identical when

Calculate GDP for an economy with exports of $5 trillion, investment of $1.5 trillion, consumption spending of $11 trillion, imports of $6 trillion, and government purchases of $3 trillion.

Table 23-6 The country of Batavia produces only chocolates and watches. Below is a table with recent information on Batavia production and prices. The base year is 2009. Prices and Quantities -Refer to Table 23-6. What was nominal GDP, real GDP, and the GDP deflator for 2009? Show your work.

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

Applications: 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 Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

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 Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters

The advantage of real GDP as a measure is the fact that it only increases.

GDP and GNP are identical when