Question 1

If we calculate the real GDP using the __________ index,we use the __________ period's prices.

Accepted Answer

A) Laspeyres;final 
B) Paasche;final 
C) Paasche;initial 
D) chain-weighted;current 
E) chain-weighted;final 
A) Laspeyres;final 
B) Paasche;final 
C) Paasche;initial 
D) chain-weighted;current 
E) chain-weighted;final

Question 2

What are the components which make up the income approach to calculating GDP? What are the components which make up the expenditure approach to calculating GDP?

Accepted Answer

(a)Income approach: compensation to empl

Question 3

If the percent change in real GDP is found to be 4 percent using the Laspeyres index and 3 percent using the Paasche index,the chain-weighted price index will give us a growth rate of 3.5 percent.

Accepted Answer

A) True 
 B)False

Question 4

When you buy a car from your brother,which he bought new in 2000,the purchase adds to the current GDP.

Accepted Answer

A) True 
 B)False

Question 5

According to the expenditure approach,if Y is GDP,C is consumption,I is investment,G is government purchases,and NX is net exports,the national income identity can be written as:

Accepted Answer

A) Y = C + I + G. 
B) Y = C + I + G - NX. 
C) Y + C = I + G + NX. 
D) Y = (C + I + G)/NX. 
E) Y = C + I + G + NX. 
A) Y = C + I + G. 
B) Y = C + I + G - NX. 
C) Y + C = I + G + NX. 
D) Y = (C + I + G)/NX. 
E) Y = C + I + G + NX.

Question 6

GDP often is used as a "measure" of economic welfare;it includes all factors that contribute to economic wellbeing.

Accepted Answer

A) True 
 B)False

Question 7

By how much does the current GDP rise in the following scenario? A real estate agent sells a house for $250,000 that the previous owners had purchased 10 years earlier for $90,000.The real estate agent earns a commission of $10,000.

Accepted Answer

A) $160,000 
B) $250,000 
C) $10,000 
D) $90,000 
E) $260,000 
A) $160,000 
B) $250,000 
C) $10,000 
D) $90,000 
E) $260,000

Question 8

The price level can be derived as __________ and is called the __________.

Accepted Answer

A) Price level = Nominal GDP ÷ Real GDP;CPI 
B) Price level = Nominal GDP $\times$Real GDP;CPI 
C) Price level = Real GDP $\times$Nominal GDP;GDP deflator 
D) Price level = Real GDP ÷ Nominal GDP;GDP deflator 
E) Price level = Nominal GDP ÷ Real GDP;GDP deflator 
A) Price level = Nominal GDP ÷ Real GDP;CPI 
B) Price level = Nominal GDP $\times$Real GDP;CPI 
C) Price level = Real GDP $\times$Nominal GDP;GDP deflator 
D) Price level = Real GDP ÷ Nominal GDP;GDP deflator 
E) Price level = Nominal GDP ÷ Real GDP;GDP deflator

Question 9

An economy's __________ is equal to its __________.

Accepted Answer

A) consumption;income 
B) expenditure on goods and services;output 
C) expenditure on goods;expenditure on services 
D) investment;government expenditures 
E) taxes;net exports 
A) consumption;income 
B) expenditure on goods and services;output 
C) expenditure on goods;expenditure on services 
D) investment;government expenditures 
E) taxes;net exports

Question 10

Which macroeconomic variables has the text not yet discussed in much detail?

Accepted Answer

A) nominal GDP 
B) real GDP 
C) GDP deflator 
D) all of the above 
E) none of the above 
A) nominal GDP 
B) real GDP 
C) GDP deflator 
D) all of the above 
E) none of the above

Question 11

The National Income and Product Accounts allows us to relate __________ to __________ to __________.

Accepted Answer

A) household income;government income;firm income 
B) total output;total spending;inflation 
C) total output;inflation;total income 
D) household income;household expenditure;total output 
E) total output;total spending;total income 
A) household income;government income;firm income 
B) total output;total spending;inflation 
C) total output;inflation;total income 
D) household income;household expenditure;total output 
E) total output;total spending;total income

Question 12

Using the expenditure approach,investment includes

Accepted Answer

A) household residential expenditures. 
B) firm structures,equipment,and inventories. 
C) fixed firm and household structures,equipment,and inventories. 
D) government and firm equipment expenditures. 
E) government defense and firm equipment expenditures. 
A) household residential expenditures. 
B) firm structures,equipment,and inventories. 
C) fixed firm and household structures,equipment,and inventories. 
D) government and firm equipment expenditures. 
E) government defense and firm equipment expenditures.

Question 13

Which macroeconomic variables has the text not yet discussed in much detail?

Accepted Answer

A) the unemployment rate 
B) interest rates 
C) exchange rates 
D) all of the above 
E) none of the above 
A) the unemployment rate 
B) interest rates 
C) exchange rates 
D) all of the above 
E) none of the above

Question 14

You are a staff economist for your local bank and the bank manager claims that in 2008 the Chinese economy is bigger than in the United States.To prove him wrong you decide to put your economics training to work for you and decide to show him China's GDP in U.S.dollars,and to show him how smart you are,you also decide to calculate PPP GDP in China and compare that to the United States as well.You have the following data: In 2007 China's nominal GDP was 26.324 trillion ( = Chinese yuan);the yuan-dollar exchange rate was ¥7.35/$1;nominal GDP in the United States was $13.741 trillion;the price level in the United States was 1.00 and the price level in China was 0.32.How big is China's economy?

Accepted Answer

The first part of the question is straig

Question 15

In 2005,consumption expenditures accounted for about 70 percent of the total GDP.

Accepted Answer

A) True 
 B)False

Question 16

-Consider Table 2.3.Using the Laspeyres index,the percent change in nominal GDP was about:

Accepted Answer

A) 5 percent. 
B) 1 percent. 
C) 6 percent. 
D) 0 percent. 
E) Not enough information is given. 
A) 5 percent. 
B) 1 percent. 
C) 6 percent. 
D) 0 percent. 
E) Not enough information is given.

Question 17

If NGDP is nominal GDP and P is the price level,which of the following can be used to calculate the growth of the real GDP?

Accepted Answer

A) percent change in NGDP - percent change in P 
B) percent change in NGDP + percent change in P 
C) percent change in NGDP $\times$ percent change in P 
D) percent change in P + percent change in NGDP 
E) percent change in P - percent change in NGDP 
A) percent change in NGDP - percent change in P 
B) percent change in NGDP + percent change in P 
C) percent change in NGDP $\times$ percent change in P 
D) percent change in P + percent change in NGDP 
E) percent change in P - percent change in NGDP

Question 18

Suppose we calculate the percent change in real GDP from year 1 to year 2 using both the Laspeyres and the Paasche indices.With the Laspeyres index we get 12 percent and with the Paasche index we get 9 percent.The chain-weighted growth of real GDP is:

Accepted Answer

A) 1.5 percent. 
B) 9.75 percent. 
C) 1.33 percent. 
D) 9.5 percent. 
E) 10.5 percent. 
A) 1.5 percent. 
B) 9.75 percent. 
C) 1.33 percent. 
D) 9.5 percent. 
E) 10.5 percent.

Question 19

To get an accurate view of how GDPs differ across countries,we simply need to convert all countries' GDPs into dollars using the prevailing exchange rate.

Accepted Answer

A) True 
 B)False

Question 20

The statistic used by economists to measure the value of economic output is:

Accepted Answer

A) the unemployment rate. 
B) GDP. 
C) the CPI. 
D) the GDP deflator. 
E) the federal funds rate. 
A) the unemployment rate. 
B) GDP. 
C) the CPI. 
D) the GDP deflator. 
E) the federal funds rate.

If we calculate the real GDP using the index,we use the period's prices.

What are the components which make up the income approach to calculating GDP? What are the components which make up the expenditure approach to calculating GDP?

If the percent change in real GDP is found to be 4 percent using the Laspeyres index and 3 percent using the Paasche index,the chain-weighted price index will give us a growth rate of 3.5 percent.

When you buy a car from your brother,which he bought new in 2000,the purchase adds to the current GDP.

According to the expenditure approach,if Y is GDP,C is consumption,I is investment,G is government purchases,and NX is net exports,the national income identity can be written as:

GDP often is used as a "measure" of economic welfare;it includes all factors that contribute to economic wellbeing.

By how much does the current GDP rise in the following scenario? A real estate agent sells a house for $250,000 that the previous owners had purchased 10 years earlier for $90,000.The real estate agent earns a commission of $10,000.

The price level can be derived as and is called the .

An economy's is equal to its .

Which macroeconomic variables has the text not yet discussed in much detail?

The National Income and Product Accounts allows us to relate to to __.

Using the expenditure approach,investment includes

Which macroeconomic variables has the text not yet discussed in much detail?

In 2005,consumption expenditures accounted for about 70 percent of the total GDP.

-Consider Table 2.3.Using the Laspeyres index,the percent change in nominal GDP was about:

If NGDP is nominal GDP and P is the price level,which of the following can be used to calculate the growth of the real GDP?

Suppose we calculate the percent change in real GDP from year 1 to year 2 using both the Laspeyres and the Paasche indices.With the Laspeyres index we get 12 percent and with the Paasche index we get 9 percent.The chain-weighted growth of real GDP is:

To get an accurate view of how GDPs differ across countries,we simply need to convert all countries' GDPs into dollars using the prevailing exchange rate.

The statistic used by economists to measure the value of economic output is:

Introduction to Macroeconomics

An Overview of Long- Run Economic Growth

A Model of Production

The Solow Growth Model

Growth and Ideas

The Labor Market,wages,and Unemployment

Inflation

An Introduction to the Short Run

The Great Recession: a First Look

The Is Curve

Monetary Policy and the Phillips Curve

Stabilization Policy and the Asad Framework

The Great Recession and the Short-Run Model

Consumption

Investment

The Government and the Macroeconomy

International Trade

Exchange Rates and International Finance

Parting Thoughts

Filters

Exam 2: Measuring the Macroeconomy

If we calculate the real GDP using the __________ index,we use the __________ period's prices.

What are the components which make up the income approach to calculating GDP? What are the components which make up the expenditure approach to calculating GDP?

If the percent change in real GDP is found to be 4 percent using the Laspeyres index and 3 percent using the Paasche index,the chain-weighted price index will give us a growth rate of 3.5 percent.

When you buy a car from your brother,which he bought new in 2000,the purchase adds to the current GDP.

According to the expenditure approach,if Y is GDP,C is consumption,I is investment,G is government purchases,and NX is net exports,the national income identity can be written as:

GDP often is used as a "measure" of economic welfare;it includes all factors that contribute to economic wellbeing.

By how much does the current GDP rise in the following scenario? A real estate agent sells a house for $250,000 that the previous owners had purchased 10 years earlier for $90,000.The real estate agent earns a commission of $10,000.

The price level can be derived as __________ and is called the __________.

An economy's __________ is equal to its __________.

Which macroeconomic variables has the text not yet discussed in much detail?

The National Income and Product Accounts allows us to relate __________ to __________ to __________.

Using the expenditure approach,investment includes

Which macroeconomic variables has the text not yet discussed in much detail?

In 2005,consumption expenditures accounted for about 70 percent of the total GDP.

-Consider Table 2.3.Using the Laspeyres index,the percent change in nominal GDP was about:

If NGDP is nominal GDP and P is the price level,which of the following can be used to calculate the growth of the real GDP?

Suppose we calculate the percent change in real GDP from year 1 to year 2 using both the Laspeyres and the Paasche indices.With the Laspeyres index we get 12 percent and with the Paasche index we get 9 percent.The chain-weighted growth of real GDP is:

To get an accurate view of how GDPs differ across countries,we simply need to convert all countries' GDPs into dollars using the prevailing exchange rate.

The statistic used by economists to measure the value of economic output is:

Introduction to Macroeconomics

An Overview of Long- Run Economic Growth

A Model of Production

The Solow Growth Model

Growth and Ideas

The Labor Market,wages,and Unemployment

Inflation

An Introduction to the Short Run

The Great Recession: a First Look

The Is Curve

Monetary Policy and the Phillips Curve

Stabilization Policy and the Asad Framework

The Great Recession and the Short-Run Model

Consumption

Investment

The Government and the Macroeconomy

International Trade

Exchange Rates and International Finance

Parting Thoughts

Filters

If we calculate the real GDP using the index,we use the period's prices.

The price level can be derived as and is called the .

An economy's is equal to its .

The National Income and Product Accounts allows us to relate to to __.