Exam 2: The Measurement and Structure of the National Economy

The government budget surplus equals

If nominal GDP for 2009 is $6400 billion and real GDP for 2010 is $6720 billion (in 2005 dollars),then the growth rate of real GDP is

The Boskin Commission concluded that the CPI overstates increases in the cost of living by ________ percentage point(s)per year.

In 1975,Richard Petty won the NASCAR race in Richmond,earning $6,265.In 2006,Dale Earnhardt,Jr.,won the race,earning $239,166.The CPI index was 52.5 in 1975 and 198.7 in 2006 (base year = 1982-1984).Calculate the real earnings (based on base year 1982-1984)of both Petty and Earnhardt.

The CPI may overstate inflation for all the following reasons except

The value of a household's assets minus the value of its liabilities is called

Suppose that private saving is $1590 billion,investment is $1945 billion,and the current account balance is -$489 billion.From the uses-of-saving identity,how much is government saving?

The Bigdrill company drills for oil,which it sells for $200 million to the Bigoil company to be made into gas.The Bigoil company's gas is sold for a total of $600 million.What is the total contribution to the country's GDP from companies Bigdrill and Bigoil?

In the expenditure approach to GDP,which of the following would be excluded from measurements of GDP?

Citizens of the country of Heehaw produce hay and provide entertainment services (banjo playing).In one year they produced $15 million worth of hay,with $11 million consumed domestically and the other $4 million sold to neighboring countries.They provided $7 million worth of banjo-playing services,$5 million in Heehaw,and $2 million in neighboring countries.They purchased $6 million worth of soda pop from neighboring countries. Calculate the magnitudes of GNP,GDP,net factor payments from abroad,net exports,and the current account balance.

Because government services are not sold in markets,

The country of Old Jersey produces milk and butter,and it has published the following macroeconomic data,where quantities are in gallons and prices are dollars per gallon. Between Year 1 and Year 2,the percent change in real GDP (based on Year 1 as a base year)was

Nations such as Egypt and Turkey may have wide differences between GNP and GDP because both the countries

The value of a producer's output minus the value of the inputs it purchases from other producers is called the producer's

Which of the following is included in U.S.GDP?

In 2008,inflation exceeded expected inflation.In 2009,expected inflation exceeded inflation.Therefore the real interest rate was ________ than the expected real interest rate in 2008 and the real interest rate was ________ than the expected real interest rate in 2009.

In the mid-to-late 1980s,the United States had "twin deficits" because both ________ and ________ were negative.

If C = $500,I = $150,G = $100,NX = $40,and GNP = $800,how much is NFP?

The Compagnie Naturelle sells mounted butterflies,using butterfly bait it buys from another firm for $20,000.It pays its workers $35,000,pays $1,000 in taxes,and has profits of $3,000.What is its value added?

By how much does the CPI overstate true increases in the cost of living,according to the Boskin Commission? What are the main reasons for this bias in the CPI? What are the economic implications of the bias?