Question 1

The majority of spending in the government purchases category comes from the federal government.

Accepted Answer

A) True 
 B)False

Question 2

Suppose that a sporting goods store had $800 of golf balls on its shelves at the beginning of 2016 and $1,300 at the end of 2016. The amount of inventory investment included in GDP would be

Accepted Answer

A)  $500. 
B)  $800. 
C)  $1,300. 
D)  $2,100. 
A)  $500. 
B)  $800. 
C)  $1,300. 
D)  $2,100.

Question 3

To an economist, "investment" in the GDP accounts means purchases of new final goods and services by firms.

Accepted Answer

A) True 
 B)False

Question 4

What type of spending is the largest component of the GDP?

Accepted Answer

A)  consumption expenditures 
B)  government purchases 
C)  net exports 
D)  investment 
A)  consumption expenditures 
B)  government purchases 
C)  net exports 
D)  investment

Question 5

The manner in which a nation's economy reacts when the measured factors are changed affects almost every individual.

Accepted Answer

A) True 
 B)False

Question 6

What are the two critical measures of a nation's economic health?

Accepted Answer

A)  income and spending 
B)  sales and taxes 
C)  wages and raises 
D)  production and income 
A)  income and spending 
B)  sales and taxes 
C)  wages and raises 
D)  production and income

Question 7

Business cycles are

Accepted Answer

A)  movements in stock prices. 
B)  the transfer of executives between firms. 
C)  used to describe fluctuations in GDP. 
D)  a description of the time required to bring a new product to market. 
A)  movements in stock prices. 
B)  the transfer of executives between firms. 
C)  used to describe fluctuations in GDP. 
D)  a description of the time required to bring a new product to market.

Question 8

Fluctuations in economic performance is one of the two basic issues of macroeconomics. The other is

Accepted Answer

A)  tracking unemployment. 
B)  keeping interest rates in check. 
C)  long-run economic growth. 
D)  monitoring inflation rates. 
A)  tracking unemployment. 
B)  keeping interest rates in check. 
C)  long-run economic growth. 
D)  monitoring inflation rates.

Question 9

In the study of macroeconomics, production leads to income, and income leads to production in a continuing cycle.

Accepted Answer

A) True 
 B)False

Question 10

GDP is supposed to measure the goods ________ the United States.

Accepted Answer

A)  purchased in 
B)  produced in 
C)  imported to 
D)  exported to 
A)  purchased in 
B)  produced in 
C)  imported to 
D)  exported to

Question 11

A trade surplus occurs when a country's exports exceed that country's imports.

Accepted Answer

A) True 
 B)False

Question 12

Social Security payments are examples of

Accepted Answer

A)  nondurable goods. 
B)  durable goods. 
C)  services. 
D)  transfer payments. 
A)  nondurable goods. 
B)  durable goods. 
C)  services. 
D)  transfer payments.

Question 13

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 14

"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 15

If in the third quarter of 2016 total investment spending was $4,768 billion and depreciation was $3,292 billion, then the amount counted in GDP, which is known as gross investment, would be

Accepted Answer

A)  $1,476 billion. 
B)  $3,292 billion. 
C)  $4,768 billion. 
D)  $8,060 billion. 
A)  $1,476 billion. 
B)  $3,292 billion. 
C)  $4,768 billion. 
D)  $8,060 billion.

Question 16

Personal income and personal disposable income refer to payments ultimately flowing to

Accepted Answer

A)  firms. 
B)  households. 
C)  governments. 
D)  foreigners. 
A)  firms. 
B)  households. 
C)  governments. 
D)  foreigners.

Question 17

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 18

Which of the following is NOT a component of value added of a firm?

Accepted Answer

A)  expenditures on intermediate goods 
B)  profits 
C)  wages 
D)  interest 
A)  expenditures on intermediate goods 
B)  profits 
C)  wages 
D)  interest

Question 19

A depression is

Accepted Answer

A)  a severe recession. 
B)  a sustained economic upturn. 
C)  another word for a bull market. 
D)  the period of time following a peak in the business cycle. 
A)  a severe recession. 
B)  a sustained economic upturn. 
C)  another word for a bull market. 
D)  the period of time following a peak in the business cycle.

Question 20

Not including transactions from the underground economy will tend to ________ GDP, and not including environmental changes caused by pollution will tend to ________ GDP.

Accepted Answer

A)  overvalue; undervalue 
B)  undervalue; overvalue 
C)  overvalue; overvalue 
D)  undervalue; undervalue 
A)  overvalue; undervalue 
B)  undervalue; overvalue 
C)  overvalue; overvalue 
D)  undervalue; undervalue

The majority of spending in the government purchases category comes from the federal government.

Suppose that a sporting goods store had $800 of golf balls on its shelves at the beginning of 2016 and $1,300 at the end of 2016. The amount of inventory investment included in GDP would be

To an economist, "investment" in the GDP accounts means purchases of new final goods and services by firms.

What type of spending is the largest component of the GDP?

The manner in which a nation's economy reacts when the measured factors are changed affects almost every individual.

What are the two critical measures of a nation's economic health?

Business cycles are

Fluctuations in economic performance is one of the two basic issues of macroeconomics. The other is

In the study of macroeconomics, production leads to income, and income leads to production in a continuing cycle.

GDP is supposed to measure the goods ________ the United States.

A trade surplus occurs when a country's exports exceed that country's imports.

Social Security payments are examples of

A "trade deficit" occurs when

"Final goods and services" are those that are

If in the third quarter of 2016 total investment spending was $4,768 billion and depreciation was $3,292 billion, then the amount counted in GDP, which is known as gross investment, would be

Personal income and personal disposable income refer to payments ultimately flowing to

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

Which of the following is NOT a component of value added of a firm?

A depression is

Not including transactions from the underground economy will tend to GDP, and not including environmental changes caused by pollution will tend to GDP.

Introduction: What Is Economics

The Key Principles of Economics

Demand, Supply, and Market Equilibrium

Elasticity: A Measure of Responsiveness

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry, Monopolistic Competition, and Oligopoly

Imperfect Information, External Benefits, and External Costs

The Labor Market and the Distribution of Income

Unemployment and Inflation

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and the Banking System

Monetary Policy and Inflation

International Trade and Finance

Filters

Exam 11: Measuring a Nations Production and Income

The majority of spending in the government purchases category comes from the federal government.

Suppose that a sporting goods store had $800 of golf balls on its shelves at the beginning of 2016 and $1,300 at the end of 2016. The amount of inventory investment included in GDP would be

To an economist, "investment" in the GDP accounts means purchases of new final goods and services by firms.

What type of spending is the largest component of the GDP?

The manner in which a nation's economy reacts when the measured factors are changed affects almost every individual.

What are the two critical measures of a nation's economic health?

Business cycles are

Fluctuations in economic performance is one of the two basic issues of macroeconomics. The other is

In the study of macroeconomics, production leads to income, and income leads to production in a continuing cycle.

GDP is supposed to measure the goods ________ the United States.

A trade surplus occurs when a country's exports exceed that country's imports.

Social Security payments are examples of

A "trade deficit" occurs when

"Final goods and services" are those that are

If in the third quarter of 2016 total investment spending was $4,768 billion and depreciation was $3,292 billion, then the amount counted in GDP, which is known as gross investment, would be

Personal income and personal disposable income refer to payments ultimately flowing to

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

Which of the following is NOT a component of value added of a firm?

A depression is

Not including transactions from the underground economy will tend to ________ GDP, and not including environmental changes caused by pollution will tend to ________ GDP.

Introduction: What Is Economics

The Key Principles of Economics

Demand, Supply, and Market Equilibrium

Elasticity: A Measure of Responsiveness

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry, Monopolistic Competition, and Oligopoly

Imperfect Information, External Benefits, and External Costs

The Labor Market and the Distribution of Income

Unemployment and Inflation

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and the Banking System

Monetary Policy and Inflation

International Trade and Finance

Filters

Not including transactions from the underground economy will tend to GDP, and not including environmental changes caused by pollution will tend to GDP.