Question 1

Which government entity calculates GDP in the United States on a quarterly basis?

Accepted Answer

A) the Treasury Department 
B) the Commerce Department 
C) the Federal Reserve 
D) all of the above 
E) none of the above 
A) the Treasury Department 
B) the Commerce Department 
C) the Federal Reserve 
D) all of the above 
E) none of the above B

Question 2

Computing the CPI is important because it provides ________.

Accepted Answer

A) a rough measure of the cost of living 
B) it is used as a benchmark in labor negotiations 
C) government uses it to index entitlements,such as social security benefits,so that beneficiaries do not lose purchasing power in periods of inflation 
D) all of the above 
E) none of the above 
A) a rough measure of the cost of living 
B) it is used as a benchmark in labor negotiations 
C) government uses it to index entitlements,such as social security benefits,so that beneficiaries do not lose purchasing power in periods of inflation 
D) all of the above 
E) none of the above D

Question 3

Which of the following is included in the calculation of national income?

Accepted Answer

A) compensation of employees 
B) rental income 
C) indirect business taxes 
D) all of the above 
E) none of the above 
A) compensation of employees 
B) rental income 
C) indirect business taxes 
D) all of the above 
E) none of the above D

Question 4

Which of the following is a valid characteristic of the U.S.economy over the last sixty years?

Accepted Answer

A) Investment is more volatile than other components of GDP. 
B) Government spending has remained around 20% of GDP over much of the postwar period. 
C) The U.S.has,for the most part,been running a trade deficit which has trended upward to over 5% of GDP. 
D) all of the above 
E) none of the above 
A) Investment is more volatile than other components of GDP. 
B) Government spending has remained around 20% of GDP over much of the postwar period. 
C) The U.S.has,for the most part,been running a trade deficit which has trended upward to over 5% of GDP. 
D) all of the above 
E) none of the above

Question 5

Which component of employee compensation has grown most rapidly in recent decades?

Accepted Answer

A) net interest income 
B) benefits 
C) transfer payments 
D) wages and salaries 
E) net factor income 
A) net interest income 
B) benefits 
C) transfer payments 
D) wages and salaries 
E) net factor income

Question 6

Real and Nominal GDP  
-Based on the table "Real and Nominal GDP," if year one is the base year,then the GDP deflator for year two is ________.

Accepted Answer

A) 95.5 
B) 123.5 
C) 118 
D) 104.7 
E) 116.6 
A) 95.5 
B) 123.5 
C) 118 
D) 104.7 
E) 116.6

Question 7

The inflation rate = ________.

Accepted Answer

A) nominal GDP - real GDP 
B) growth rate in real GDP - growth rate in nominal GDP 
C) growth rate in real GDP + growth rate in nominal GDP 
D) nominal GDP ÷ real GDP 
E) none of the above 
A) nominal GDP - real GDP 
B) growth rate in real GDP - growth rate in nominal GDP 
C) growth rate in real GDP + growth rate in nominal GDP 
D) nominal GDP ÷ real GDP 
E) none of the above

Question 8

The total income earned by residents of an economy is known as

Accepted Answer

A) private disposable income 
B) gross national product 
C) gross domestic product 
D) national income 
E) none of the above 
A) private disposable income 
B) gross national product 
C) gross domestic product 
D) national income 
E) none of the above

Question 9

Real GDP =________ where the price level is the ________.

Accepted Answer

A) Nominal GDP × Price level;GDP deflator 
B) Nominal GDP ÷ Price level;GDP deflator 
C) Nominal GDP ÷ Price level;CPI 
D) Nominal GDP × Price level;CPI 
E) none of the above 
A) Nominal GDP × Price level;GDP deflator 
B) Nominal GDP ÷ Price level;GDP deflator 
C) Nominal GDP ÷ Price level;CPI 
D) Nominal GDP × Price level;CPI 
E) none of the above

Question 10

There are different interest rates associated with many types of securities.Which of the following statements is correct?

Accepted Answer

A) they vary depending on the liquidity of the security 
B) they vary depending on the risk associated with the security 
C) except in very unusual times,most interest rates move together 
D) all of the above 
E) none of the above 
A) they vary depending on the liquidity of the security 
B) they vary depending on the risk associated with the security 
C) except in very unusual times,most interest rates move together 
D) all of the above 
E) none of the above

Question 11

The reason only newly produced goods and services are counted in GDP is that ________.

Accepted Answer

A) it is very difficult to impute a value to used goods 
B) most expenditures on used goods and services take place outside the market 
C) it does not help economists make better economic predictions because second-hand goods rarely have any residual value 
D) it allows economists to avoid double counting the production of goods and services 
E) none of the above 
A) it is very difficult to impute a value to used goods 
B) most expenditures on used goods and services take place outside the market 
C) it does not help economists make better economic predictions because second-hand goods rarely have any residual value 
D) it allows economists to avoid double counting the production of goods and services 
E) none of the above

Question 12

Consider a firm whose final output (and sales)in a particular year has a value of $1,200.To produce these goods,the firm used $500 worth of intermediate goods it had purchased in previous years plus $200 worth of newly-purchased intermediate goods.In the subsequent year,this same firm again sells $1,200 worth of final goods,but in this year has purchased $700 worth of intermediate goods,of which $100 is not used in current production but,rather,added to the firm's inventory.For each of these two years,calculate the value added by this firm.For each of these two years,calculate the contribution of this firm to the economy's GDP.

Accepted Answer

Value added in year one equals $1,200 fi

Question 13

Examples of deflators are the ________ and ________ deflator

Accepted Answer

A) real;nominal 
B) private disposable income;gross national product 
C) personal consumption expenditure;gross domestic product 
D) gross domestic product;rental income 
E) private disposable income;personal consumption expenditure 
A) real;nominal 
B) private disposable income;gross national product 
C) personal consumption expenditure;gross domestic product 
D) gross domestic product;rental income 
E) private disposable income;personal consumption expenditure

Question 14

Which of these represents an example of citizens who would not typically be counted as unemployed?

Accepted Answer

A) when your economics professor loses his job and gets a new one at McDonald's 
B) when your fourteen-year-old cousin loses her summer job in September 
C) when your neighbor has been out of work for so long that he decides to stay at home and write a novel 
D) all of the above 
E) none of the above 
A) when your economics professor loses his job and gets a new one at McDonald's 
B) when your fourteen-year-old cousin loses her summer job in September 
C) when your neighbor has been out of work for so long that he decides to stay at home and write a novel 
D) all of the above 
E) none of the above

Question 15

Real and Nominal GDP  
-Based on the table "Real and Nominal GDP," if year one is the base year,then the real GDP in year three,is ________.

Accepted Answer

A) 7200 
B) 8250 
C) 1050 
D) 7500 
E) none of the above 
A) 7200 
B) 8250 
C) 1050 
D) 7500 
E) none of the above

Question 16

Variables measured at current market prices are nominal,rather than real.In what sense are nominal variables unreal?

Accepted Answer

Nominal variables combine a thing being

Question 17

In a two-good economy,the price of video games is $40 and the price of energy drinks is $2.If the annual output of this economy is 100 video games and 500 drinks,the GDP is ________.

Accepted Answer

A) $50,080 
B) $25,200 
C) $5,000 
D) $20,200 
E) none of the above 
A) $50,080 
B) $25,200 
C) $5,000 
D) $20,200 
E) none of the above

Question 18

Table 2.1 GDP and its components,2012  
-Assuming that the GDP breakdown shown in Table 2.1 is typical of a given year in the U.S.we can say that ________.

Accepted Answer

A) federal defense spending is twice that of non-defense spending 
B) federal spending is twice as large as that of the states and local governments 
C) government spending constitutes about 40% of GDP 
D) all of the above 
E) none of the above 
A) federal defense spending is twice that of non-defense spending 
B) federal spending is twice as large as that of the states and local governments 
C) government spending constitutes about 40% of GDP 
D) all of the above 
E) none of the above

Question 19

Nominal GDP =________ where the price level is the ________.

Accepted Answer

A) Price level ÷ Real GDP;GDP deflator 
B) Price level × Real GDP;CPI 
C) Price level ÷ Real GDP;CPI 
D) Price level × Real GDP;GDP deflator 
E) none of the above 
A) Price level ÷ Real GDP;GDP deflator 
B) Price level × Real GDP;CPI 
C) Price level ÷ Real GDP;CPI 
D) Price level × Real GDP;GDP deflator 
E) none of the above

Question 20

The income approach to measuring GDP involves adding up the following ________.

Accepted Answer

A) household income and income generated by firms 
B) private spending,tax revenues and government spending 
C) transfer payments and income taxes 
D) interest income,profits and social security benefits 
E) wages,benefits and interest income 
A) household income and income generated by firms 
B) private spending,tax revenues and government spending 
C) transfer payments and income taxes 
D) interest income,profits and social security benefits 
E) wages,benefits and interest income

Exam 2: Measuring Macroeconomic Data

Which government entity calculates GDP in the United States on a quarterly basis?

Computing the CPI is important because it provides ________.

Which of the following is included in the calculation of national income?

Which of the following is a valid characteristic of the U.S.economy over the last sixty years?

Which component of employee compensation has grown most rapidly in recent decades?

Real and Nominal GDP -Based on the table "Real and Nominal GDP," if year one is the base year,then the GDP deflator for year two is ________.

The inflation rate = ________.

The total income earned by residents of an economy is known as

Real GDP =________ where the price level is the ________.

There are different interest rates associated with many types of securities.Which of the following statements is correct?

The reason only newly produced goods and services are counted in GDP is that ________.

Examples of deflators are the ________ and ________ deflator

Which of these represents an example of citizens who would not typically be counted as unemployed?

Real and Nominal GDP -Based on the table "Real and Nominal GDP," if year one is the base year,then the real GDP in year three,is ________.

Variables measured at current market prices are nominal,rather than real.In what sense are nominal variables unreal?

In a two-good economy,the price of video games is $40 and the price of energy drinks is $2.If the annual output of this economy is 100 video games and 500 drinks,the GDP is ________.

Table 2.1 GDP and its components,2012 -Assuming that the GDP breakdown shown in Table 2.1 is typical of a given year in the U.S.we can say that ________.

Nominal GDP =________ where the price level is the ________.

The income approach to measuring GDP involves adding up the following ________.

The Policy and Practice of Macroeconomics

Aggregate Production and Productivity

Saving and Investment in Closed and Open Economies

Money and Inflation

The Sources of Growth and the Solow Model

Drivers of Growth: Technology, policy, and Institutions

Business Cycles: an Introduction

The Is Curve

Monetary Policy and Aggregate Demand

Aggregate Supply and the Phillips Curve

The Aggregate Demand and Supply Model

Macroeconomic Policy and Aggregate Demand and Supply Analysis

The Financial System and Economic Growth

Financial Crises and the Economy

Fiscal Policy and the Government Budget

Exchange Rates and International Economic Policy

Consumption and Saving

Investment

The Labor Market, employment, and Unemployment

The Role of Expectations in Macroeconomic Policy

Modern Business Cycle Theory

Filters

Real GDP = where the price level is the .

Examples of deflators are the and deflator

Nominal GDP = where the price level is the .