Question 1

How does the expenditures measure of GDP differ from the production measure?

Accepted Answer

A)  It doesn't. The final value is the same. 
B)  It is lower, because only purchased items are counted. 
C)  It is higher due to the higher cost of a final good than of the inputs. 
D)  It depends on the amount of inventories held at the beginning and end of the year. 
A)  It doesn't. The final value is the same. 
B)  It is lower, because only purchased items are counted. 
C)  It is higher due to the higher cost of a final good than of the inputs. 
D)  It depends on the amount of inventories held at the beginning and end of the year.

Question 2

The following table contains statistics for the country of Caddyville in 2013.
  
-Refer to the table above.What is the unemployment rate in Caddyville for 2013?

Accepted Answer

A)  5.5 percent 
B)  6.5 percent 
C)  7.2 percent 
D)  7.7 percent 
A)  5.5 percent 
B)  6.5 percent 
C)  7.2 percent 
D)  7.7 percent

Question 3

The table below contains data for the country of Wandalian for the year 2017.
  
-Refer to the above table.What was Wandalian's consumption in 2017?

Accepted Answer

A)  $1,708 
B)  $1,913 
C)  $2,035 
D)  $3,052 
A)  $1,708 
B)  $1,913 
C)  $2,035 
D)  $3,052

Question 4

________ will lead to an increase in the GDP of a country,all other variables remaining unchanged.

Accepted Answer

A)  An increase in imports 
B)  An increase in expenditure incurred by the government 
C)  A fall in the expenditure on consumption 
D)  A fall in the expenditure on investment goods 
A)  An increase in imports 
B)  An increase in expenditure incurred by the government 
C)  A fall in the expenditure on consumption 
D)  A fall in the expenditure on investment goods

Question 5

What are the two categories of income payments and what fraction of total income payments do they each make up?

Accepted Answer

A)  Labor income, two-thirds and capital income, one-third 
B)  Skilled-labor income, three-fourths and unskilled-labor income, one-fourth 
C)  Labor income, one-third and capital income, two-thirds 
D)  Skilled-labor income, one-half and unskilled-labor income, one-half 
A)  Labor income, two-thirds and capital income, one-third 
B)  Skilled-labor income, three-fourths and unskilled-labor income, one-fourth 
C)  Labor income, one-third and capital income, two-thirds 
D)  Skilled-labor income, one-half and unskilled-labor income, one-half

Question 6

Scenario: Mike's housekeeper charges $30 for mowing his lawn.
-Refer to the scenario above.Which of the following will happen if Mike starts charging $30 to mow lawns that were previously mowed by their owners?

Accepted Answer

A)  GDP will increase. 
B)  GDP will decrease. 
C)  Income per capita will remain unchanged. 
D)  Income per capita will decrease. 
A)  GDP will increase. 
B)  GDP will decrease. 
C)  Income per capita will remain unchanged. 
D)  Income per capita will decrease.

Question 7

The following table contains prices and quantities for the three goods produced in the country of Linfieldia.
  
-Refer to the table above.Assuming that 2015 is the base year,what is the inflation rate between 2014 to 2016 using the GDP deflator and the Consumer Price Index?

Accepted Answer

A)  74 percent with the GDP deflator, 94 percent with the Consumer Price Index 
B)  94 percent with the GDP deflator, 74 percent with the Consumer Price Index 
C)  74 percent with both 
D)  94 percent with both 
A)  74 percent with the GDP deflator, 94 percent with the Consumer Price Index 
B)  94 percent with the GDP deflator, 74 percent with the Consumer Price Index 
C)  74 percent with both 
D)  94 percent with both

Question 8

The following table contains statistics for the country of Caddyville in 2013.
  
-Refer to the table above.What is Caddyville's per capita income for 2013?

Accepted Answer

A)  $52,935 
B)  $61,067 
C)  $71,429 
D)  $87,532 
A)  $52,935 
B)  $61,067 
C)  $71,429 
D)  $87,532

Question 9

Scenario: A country produces only one good. It produced 5,000 units of the good during Year 1 and 6,000 units of the good in Year 2. The price of each unit of the good in Year 1 was $280 and it was $320 in Year 2. Suppose Year 1 is taken as the base year for the calculation of GDP.
-Refer to the scenario above.The nominal GDP of the country in Year 1 was ________.

Accepted Answer

A)  $540,000 
B)  $280,000 
C)  $1,400,000 
D)  $2,200,000 
A)  $540,000 
B)  $280,000 
C)  $1,400,000 
D)  $2,200,000

Question 10

Scenario: A country produces only one good. It produced 5,000 units of the good during Year 1 and 6,000 units of the good in Year 2. The price of each unit of the good in Year 1 was $280 and it was $320 in Year 2. Suppose Year 1 is taken as the base year for the calculation of GDP.
-Refer to the scenario above.The nominal GDP of the country for Year 2 was ________.

Accepted Answer

A)  $180,000 
B)  $1,920,000 
C)  $2,510,000 
D)  $174,000 
A)  $180,000 
B)  $1,920,000 
C)  $2,510,000 
D)  $174,000

Question 11

The total consumption expenditure in Polonia during a certain year was $135,000,total expenditure on investment was $44,000,and total expenditure incurred by the government was $50,000.Polonia exported goods worth $10,000 during that year and imported goods and services worth $12,000.Calculate the GNP of Polonia if foreign factors of production added a value of $14,000 to the production of goods and services in Polonia while Polonian workers living abroad added a value of $8,000 to the production process in those countries.

Accepted Answer

The formula for calculating the GNP of a

Question 12

Suppose that instead of Greg buying his lunch at a fast-food restaurant for $15.00,he buys $5 worth of food at the grocery store and spends an hour of his time creating his lunch.By how much would GDP change?

Accepted Answer

A)  -$10 
B)  -$15 
C)  $5 
D)  Not enough information provided 
A)  -$10 
B)  -$15 
C)  $5 
D)  Not enough information provided

Question 13

Which of the following would not be included in the calculation of GDP?

Accepted Answer

A)  The purchase of ice cream by a student at a store 
B)  The purchase of a new car by a family 
C)  The purchase of a steak by a customer at a restaurant 
D)  The purchase of a cow by a restaurant to turn into steaks 
A)  The purchase of ice cream by a student at a store 
B)  The purchase of a new car by a family 
C)  The purchase of a steak by a customer at a restaurant 
D)  The purchase of a cow by a restaurant to turn into steaks

Question 14

Which of the following transactions will be included in the calculation of GDP using the expenditure method?

Accepted Answer

A)  The sale of a used car by a consumer 
B)  The purchase of a private jet by the CEO of a company 
C)  The purchase of a treasury bond by an investor 
D)  The payment made to a construction worker 
A)  The sale of a used car by a consumer 
B)  The purchase of a private jet by the CEO of a company 
C)  The purchase of a treasury bond by an investor 
D)  The payment made to a construction worker

Question 15

In which of the following ways can national savings be calculated?

Accepted Answer

A)  By deducting investment and government expenditure from total output 
B)  By deducting net exports and government expenditure from total output 
C)  By deducting consumption and government expenditure from total output 
D)  By deducting consumption and investment from total output 
A)  By deducting investment and government expenditure from total output 
B)  By deducting net exports and government expenditure from total output 
C)  By deducting consumption and government expenditure from total output 
D)  By deducting consumption and investment from total output

Question 16

The following table contains statistics for the country of Gregorville in 2017, a country in which all must either attend school, be available for work, or be retired.
  
-Refer to the table above.What is the number of unemployed?

Accepted Answer

A)  10,000 
B)  14,000 
C)  24,000 
D)  78,000 
A)  10,000 
B)  14,000 
C)  24,000 
D)  78,000

Question 17

Which of the following is an example of physical capital?

Accepted Answer

A)  A stock 
B)  A bond 
C)  A factory 
D)  A worker 
A)  A stock 
B)  A bond 
C)  A factory 
D)  A worker

Question 18

Macroeconomics is the study of ________.

Accepted Answer

A)  the choices made by individuals in an economy 
B)  various political groups within an economy 
C)  economic aggregates and the economy as a whole 
D)  the statistical methods used in economics 
A)  the choices made by individuals in an economy 
B)  various political groups within an economy 
C)  economic aggregates and the economy as a whole 
D)  the statistical methods used in economics

Question 19

How does the income approach to measuring GDP compare to the production and expenditure approach to measuring GDP?

Accepted Answer

A)  It is lower, because some of the revenue from selling goods goes back into the production of more goods. 
B)  It is the same, because all revenues are either payed to workers at the company or to the owners of the company. 
C)  It is higher, because there are multiple stages along the production process where income is earned. 
D)  It is higher if the economy is in a time of strong economic growth, and it is lower in times of recession. 
A)  It is lower, because some of the revenue from selling goods goes back into the production of more goods. 
B)  It is the same, because all revenues are either payed to workers at the company or to the owners of the company. 
C)  It is higher, because there are multiple stages along the production process where income is earned. 
D)  It is higher if the economy is in a time of strong economic growth, and it is lower in times of recession.

Question 20

A Swedish citizen buys an automobile produced in the United States by a German 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

How does the expenditures measure of GDP differ from the production measure?

The following table contains statistics for the country of Caddyville in 2013. -Refer to the table above.What is the unemployment rate in Caddyville for 2013?

The table below contains data for the country of Wandalian for the year 2017. -Refer to the above table.What was Wandalian's consumption in 2017?

________ will lead to an increase in the GDP of a country,all other variables remaining unchanged.

What are the two categories of income payments and what fraction of total income payments do they each make up?

Scenario: Mike's housekeeper charges $30 for mowing his lawn. -Refer to the scenario above.Which of the following will happen if Mike starts charging $30 to mow lawns that were previously mowed by their owners?

The following table contains prices and quantities for the three goods produced in the country of Linfieldia. -Refer to the table above.Assuming that 2015 is the base year,what is the inflation rate between 2014 to 2016 using the GDP deflator and the Consumer Price Index?

The following table contains statistics for the country of Caddyville in 2013. -Refer to the table above.What is Caddyville's per capita income for 2013?

Suppose that instead of Greg buying his lunch at a fast-food restaurant for $15.00,he buys $5 worth of food at the grocery store and spends an hour of his time creating his lunch.By how much would GDP change?

Which of the following would not be included in the calculation of GDP?

Which of the following transactions will be included in the calculation of GDP using the expenditure method?

In which of the following ways can national savings be calculated?

The following table contains statistics for the country of Gregorville in 2017, a country in which all must either attend school, be available for work, or be retired. -Refer to the table above.What is the number of unemployed?

Which of the following is an example of physical capital?

Macroeconomics is the study of ________.

How does the income approach to measuring GDP compare to the production and expenditure approach to measuring GDP?

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

The Principles and Practice of Economics

Economic Methods and Economic Questions

Optimization: Doing the Best You Can

Demand, Supply, and Equilibrium

Aggregate Incomes

Economic Growth

Why Isn't the Whole World Developed?

Employment and Unemployment

Credit Markets

The Monetary System

Short-Run Fluctuations

Countercyclical Macroeconomic Policy

Macroeconomics and International Trade

Open Economy Macroeconomics

Filters

Exam 5: The Wealth of Nations: Defining and Measuring Macroeconomic Aggregates

How does the expenditures measure of GDP differ from the production measure?

The following table contains statistics for the country of Caddyville in 2013. -Refer to the table above.What is the unemployment rate in Caddyville for 2013?

The table below contains data for the country of Wandalian for the year 2017. -Refer to the above table.What was Wandalian's consumption in 2017?

________ will lead to an increase in the GDP of a country,all other variables remaining unchanged.

What are the two categories of income payments and what fraction of total income payments do they each make up?

Scenario: Mike's housekeeper charges $30 for mowing his lawn. -Refer to the scenario above.Which of the following will happen if Mike starts charging $30 to mow lawns that were previously mowed by their owners?

The following table contains prices and quantities for the three goods produced in the country of Linfieldia. -Refer to the table above.Assuming that 2015 is the base year,what is the inflation rate between 2014 to 2016 using the GDP deflator and the Consumer Price Index?

The following table contains statistics for the country of Caddyville in 2013. -Refer to the table above.What is Caddyville's per capita income for 2013?

Suppose that instead of Greg buying his lunch at a fast-food restaurant for $15.00,he buys $5 worth of food at the grocery store and spends an hour of his time creating his lunch.By how much would GDP change?

Which of the following would not be included in the calculation of GDP?

Which of the following transactions will be included in the calculation of GDP using the expenditure method?

In which of the following ways can national savings be calculated?

The following table contains statistics for the country of Gregorville in 2017, a country in which all must either attend school, be available for work, or be retired. -Refer to the table above.What is the number of unemployed?

Which of the following is an example of physical capital?

Macroeconomics is the study of ________.

How does the income approach to measuring GDP compare to the production and expenditure approach to measuring GDP?

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

The Principles and Practice of Economics

Economic Methods and Economic Questions

Optimization: Doing the Best You Can

Demand, Supply, and Equilibrium

Aggregate Incomes

Economic Growth

Why Isn't the Whole World Developed?

Employment and Unemployment

Credit Markets

The Monetary System

Short-Run Fluctuations

Countercyclical Macroeconomic Policy

Macroeconomics and International Trade

Open Economy Macroeconomics

Filters