Question 1

If a Canadian firm opens a production facility in India, the total value of the production will be included in the

Accepted Answer

A) gross domestic product of Canada. 
B) net national income of Canada. 
C) gross domestic product of India. 
D) national income of India. 
E) household disposable income of India. 
A) gross domestic product of Canada. 
B) net national income of Canada. 
C) gross domestic product of India. 
D) national income of India. 
E) household disposable income of India.

Question 2

Marla is an architect who is designing a home for Chuck.Chuck is paying Marla $150 per hour to design his new home.When Chuck and Marla get married, Marla continues to work on designing the home, but she no longer charges Chuck for her work.As a result, GDP ________ because ________.

Accepted Answer

A) falls; Marla's work takes place in the underground economy once she's married 
B) falls; Marla's work becomes less valuable once she's married 
C) falls; Marla's architectural design services are no longer bought by Chuck once they're married 
D) rises; Marla becomes more productive once she's married 
E) rises; Marla Marla's work continues to add value for Chuck 
A) falls; Marla's work takes place in the underground economy once she's married 
B) falls; Marla's work becomes less valuable once she's married 
C) falls; Marla's architectural design services are no longer bought by Chuck once they're married 
D) rises; Marla becomes more productive once she's married 
E) rises; Marla Marla's work continues to add value for Chuck

Question 3

The Canadian work week has declined from 60 hours in 1800s to 40 hours today.The impact of the decline in working hours

Accepted Answer

A) increases Canadian GDP and increases the well-being of a typical working person in Canada. 
B) increases Canadian GDP and decreases the well-being of a typical working person in Canada. 
C) decreases Canadian GDP and increases the well-being of a typical working person in Canada. 
D) decreases Canadian GDP and decreases the well-being of a typical working person in Canada. 
A) increases Canadian GDP and increases the well-being of a typical working person in Canada. 
B) increases Canadian GDP and decreases the well-being of a typical working person in Canada. 
C) decreases Canadian GDP and increases the well-being of a typical working person in Canada. 
D) decreases Canadian GDP and decreases the well-being of a typical working person in Canada.

Question 4

If a Canadian engineer works on contract for a Mexican firm, the value of the wages that engineer receives will be included in

Accepted Answer

A) Canadian GNI. 
B) Mexico's GNI. 
C) Canadian GDP. 
D) Mexico's NNI. 
E) It will not affect either Canadian GNI or Canadian GDP. 
A) Canadian GNI. 
B) Mexico's GNI. 
C) Canadian GDP. 
D) Mexico's NNI. 
E) It will not affect either Canadian GNI or Canadian GDP.

Question 5

Why do we subtract import spending from total expenditures?

Accepted Answer

Import spending is defined as spending o

Question 6

Why do we not count the value of intermediate goods and services in gross domestic product?

Accepted Answer

We would double count if we co

Question 7

Residential investment includes spending by firms on office buildings.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following would not be included in compensation of employees when calculating GDP using the income approach?

Accepted Answer

A) The wage the owner of a small business pays themselves. 
B) Canada Pension Plan (CPP)premiums paid by an employer. 
C) Wages and salaries paid to workers. 
D) The cost of a health insurance plan that a corporation buys for its employees. 
E) The cost of payroll taxes. 
A) The wage the owner of a small business pays themselves. 
B) Canada Pension Plan (CPP)premiums paid by an employer. 
C) Wages and salaries paid to workers. 
D) The cost of a health insurance plan that a corporation buys for its employees. 
E) The cost of payroll taxes.

Question 9

The values of real GDP and real GNI are almost the same in countries where a significant fraction of domestic production takes place in foreign-owned firms.

Accepted Answer

A) True 
 B)False

Question 10

Rona sells new and used doors to contractors who build new homes.Rona also sells new and used doors to homeowners.Which of the following would be counted in GDP?

Accepted Answer

A) the sale of a used door to a homeowner 
B) the sale of a new door to homeowner 
C) the sale of a used door to TapKon construction for installation into a new home 
D) the sale of a new door to TapKon construction for installation into a new home 
E) None of these sales are counted in GDP. 
A) the sale of a used door to a homeowner 
B) the sale of a new door to homeowner 
C) the sale of a used door to TapKon construction for installation into a new home 
D) the sale of a new door to TapKon construction for installation into a new home 
E) None of these sales are counted in GDP.

Question 11

Developing countries with large informal sectors tend to have firms that invest less in capital equipment.

Accepted Answer

A) True 
 B)False

Question 12

Government spending ________ is included in gross domestic product.

Accepted Answer

A) at federal, provincial, and local levels of government 
B) at the federal level of government only 
C) at provincial and local levels of government only 
D) on defense goods only 
E) at the local level only 
A) at federal, provincial, and local levels of government 
B) at the federal level of government only 
C) at provincial and local levels of government only 
D) on defense goods only 
E) at the local level only

Question 13

Suppose that nominal GDP in 2017 was less than real GDP in 2017.Given this information, we know for certain that

Accepted Answer

A) the price level in 2017 was greater than the price level in the base year. 
B) the price level in 2017 was less than the price level in the base year. 
C) real GDP in 2017 was less than real GDP in the base year. 
D) real GDP in 2017 was greater than real GDP in the base year. 
E) this is impossible, nominal GDP must always be greater than real GDP. 
A) the price level in 2017 was greater than the price level in the base year. 
B) the price level in 2017 was less than the price level in the base year. 
C) real GDP in 2017 was less than real GDP in the base year. 
D) real GDP in 2017 was greater than real GDP in the base year. 
E) this is impossible, nominal GDP must always be greater than real GDP.

Question 14

Which of the following statements is true?

Accepted Answer

A) A decrease in the crime rate increases GDP as people will spend more on security. 
B) Household production is counted in GDP as it amounts to real production. 
C) GDP accounting rules do not adjust for production that pollutes the environment. 
D) GDP growth distributes income equally to people in the economy. 
E) Purchases of stolen goods would be counted in GDP if they were observable. 
A) A decrease in the crime rate increases GDP as people will spend more on security. 
B) Household production is counted in GDP as it amounts to real production. 
C) GDP accounting rules do not adjust for production that pollutes the environment. 
D) GDP growth distributes income equally to people in the economy. 
E) Purchases of stolen goods would be counted in GDP if they were observable.

Question 15

If a country passes a labour law limiting the number of hours of work per week, GDP would ________ and leisure would ________.

Accepted Answer

A) decrease; increase 
B) increase; increase 
C) decrease; decrease 
D) increase; decrease 
A) decrease; increase 
B) increase; increase 
C) decrease; decrease 
D) increase; decrease

Question 16

________ is/are the payment for the ________ factor of production.

Accepted Answer

A) Wages; capital 
B) Interest; labour 
C) Profit; entrepreneurship 
D) Rent; capital 
E) Taxes; government 
A) Wages; capital 
B) Interest; labour 
C) Profit; entrepreneurship 
D) Rent; capital 
E) Taxes; government

Question 17

Which of the following is not included in gross operating surplus?

Accepted Answer

A) the depreciation of your university's photocopier 
B) the profits net of depreciation of Bombardier 
C) the depreciation of a United Way sign 
D) the purchase of new equipment by the government 
A) the depreciation of your university's photocopier 
B) the profits net of depreciation of Bombardier 
C) the depreciation of a United Way sign 
D) the purchase of new equipment by the government

Question 18

If GDP calculations included measurements of pollution and environmental damage, GDP values would most likely be

Accepted Answer

A) greater than their values without these measurements. 
B) less than their values without these measurements. 
C) unchanged from their values without these measurements. 
D) meaningless, since GDP values without these measurements would no longer be of value. 
E) rising more quickly than they currently are. 
A) greater than their values without these measurements. 
B) less than their values without these measurements. 
C) unchanged from their values without these measurements. 
D) meaningless, since GDP values without these measurements would no longer be of value. 
E) rising more quickly than they currently are.

Question 19

Table 4.8  
-Refer to Table 4.8.Consider the table of production and price statistics for a small economy in 2015.If the economy only produces the four goods listed below, what is GDP for 2015?

Accepted Answer

A) $428,000 
B) $267,000 
C) $24,000 
D) $3,000 
E) $1,424 
A) $428,000 
B) $267,000 
C) $24,000 
D) $3,000 
E) $1,424

Question 20

Net national income is defined as

Accepted Answer

A) gross national income plus transfer payments. 
B) gross national income, less retained earnings, plus transfer payments. 
C) gross domestic income, less retained earnings, plus transfer payments. 
D) gross domestic income less the consumption of fixed capital. 
E) gross domestic income plus taxes. 
A) gross national income plus transfer payments. 
B) gross national income, less retained earnings, plus transfer payments. 
C) gross domestic income, less retained earnings, plus transfer payments. 
D) gross domestic income less the consumption of fixed capital. 
E) gross domestic income plus taxes.

If a Canadian firm opens a production facility in India, the total value of the production will be included in the

Marla is an architect who is designing a home for Chuck.Chuck is paying Marla $150 per hour to design his new home.When Chuck and Marla get married, Marla continues to work on designing the home, but she no longer charges Chuck for her work.As a result, GDP because .

The Canadian work week has declined from 60 hours in 1800s to 40 hours today.The impact of the decline in working hours

If a Canadian engineer works on contract for a Mexican firm, the value of the wages that engineer receives will be included in

Why do we subtract import spending from total expenditures?

Why do we not count the value of intermediate goods and services in gross domestic product?

Residential investment includes spending by firms on office buildings.

Which of the following would not be included in compensation of employees when calculating GDP using the income approach?

The values of real GDP and real GNI are almost the same in countries where a significant fraction of domestic production takes place in foreign-owned firms.

Rona sells new and used doors to contractors who build new homes.Rona also sells new and used doors to homeowners.Which of the following would be counted in GDP?

Developing countries with large informal sectors tend to have firms that invest less in capital equipment.

Government spending ________ is included in gross domestic product.

Suppose that nominal GDP in 2017 was less than real GDP in 2017.Given this information, we know for certain that

Which of the following statements is true?

If a country passes a labour law limiting the number of hours of work per week, GDP would and leisure would .

is/are the payment for the factor of production.

Which of the following is not included in gross operating surplus?

If GDP calculations included measurements of pollution and environmental damage, GDP values would most likely be

Table 4.8 -Refer to Table 4.8.Consider the table of production and price statistics for a small economy in 2015.If the economy only produces the four goods listed below, what is GDP for 2015?

Net national income is defined as

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Supply and Demand

Unemployment and Inflation

Economic Growth, The Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money, Banks, and the Bank of Canada

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Bank of Canada Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

Exam 4: GDP: Measuring Total Production and Income

If a Canadian firm opens a production facility in India, the total value of the production will be included in the

Marla is an architect who is designing a home for Chuck.Chuck is paying Marla $150 per hour to design his new home.When Chuck and Marla get married, Marla continues to work on designing the home, but she no longer charges Chuck for her work.As a result, GDP ________ because ________.

The Canadian work week has declined from 60 hours in 1800s to 40 hours today.The impact of the decline in working hours

If a Canadian engineer works on contract for a Mexican firm, the value of the wages that engineer receives will be included in

Why do we subtract import spending from total expenditures?

Why do we not count the value of intermediate goods and services in gross domestic product?

Residential investment includes spending by firms on office buildings.

Which of the following would not be included in compensation of employees when calculating GDP using the income approach?

The values of real GDP and real GNI are almost the same in countries where a significant fraction of domestic production takes place in foreign-owned firms.

Rona sells new and used doors to contractors who build new homes.Rona also sells new and used doors to homeowners.Which of the following would be counted in GDP?

Developing countries with large informal sectors tend to have firms that invest less in capital equipment.

Government spending ________ is included in gross domestic product.

Suppose that nominal GDP in 2017 was less than real GDP in 2017.Given this information, we know for certain that

Which of the following statements is true?

If a country passes a labour law limiting the number of hours of work per week, GDP would ________ and leisure would ________.

________ is/are the payment for the ________ factor of production.

Which of the following is not included in gross operating surplus?

If GDP calculations included measurements of pollution and environmental damage, GDP values would most likely be

Table 4.8 -Refer to Table 4.8.Consider the table of production and price statistics for a small economy in 2015.If the economy only produces the four goods listed below, what is GDP for 2015?

Net national income is defined as

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Supply and Demand

Unemployment and Inflation

Economic Growth, The Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money, Banks, and the Bank of Canada

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Bank of Canada Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

Marla is an architect who is designing a home for Chuck.Chuck is paying Marla $150 per hour to design his new home.When Chuck and Marla get married, Marla continues to work on designing the home, but she no longer charges Chuck for her work.As a result, GDP because .

If a country passes a labour law limiting the number of hours of work per week, GDP would and leisure would .

is/are the payment for the factor of production.