Exam 23: Measuring a Nations Income

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 2008?

Last quarter Newton computers produced 3,000 computers. Two thousand of these computers were sold to households, 750 were sold to businesses, and 250 were added to Newton's inventory. How many of the computers should have been included in last quarter's GDP?

If nominal GDP is $10,000 and real GDP is $8,000, then the GDP deflator is 125.

Macroeconomic statistics tell us about a particular household, firm, or market.

Nominal GDP uses constant base-year prices to place a value on the economy's production of goods and services, while real GDP uses current prices to place a value on the economy's production of goods and services.

The income that households and noncorporate businesses receive is called

Since it is counted as investment, why doesn't the purchase of earthmoving equipment from China by a U.S. corporation increase U.S. GDP?

Are sales of used goods included in GDP? Explain why or why not. Hint: Remember how GDP is defined.

Changes in the GDP deflator reflect

​When you purchase a run-down 1965 Ford Mustang to restore and resell, the purchase of the vehicle and all restoration expenditures are included in current GDP.

The output of goods and services produced in the United States has grown on average 3 percent per year since 1965.

Most goods whose purchases are included in the investment component of GDP are used to produce other goods in future periods.

Most goods and services produced at home

Explain how GNP differs from GDP.

If an economy's GDP rises, then it must be the case that the economy's

The basic tools of supply and demand are

If exports are $500, GDP is $8000, government purchases are $1200, imports are $700, and investment is $800, then consumption is $6200.

Both the value of hamburgers sold by a restaurant and the value of the beef it used to make these hamburgers are included in GDP.

GDP is defined as the

New home construction is included in the consumption component of GDP.