Question 1

To make the calculation of real GDP more accurate,the Australian Bureau of Statistics (ABS)switched to using

Accepted Answer

A)  base year prices. 
B)  current prices. 
C)  chained prices. 
D)  market prices. 
A)  base year prices. 
B)  current prices. 
C)  chained prices. 
D)  market prices.

Question 2

The circular-flow diagram shows that

Accepted Answer

A)  the value of total income is equal to the total value of expenditures on final goods and services. 
B)  firms pay households wages, and households receive transfer payments from firms. 
C)  households spend all their income on goods and services. 
D)  GDP will be less than the total value of expenditures on final goods and services in the economy. 
A)  the value of total income is equal to the total value of expenditures on final goods and services. 
B)  firms pay households wages, and households receive transfer payments from firms. 
C)  households spend all their income on goods and services. 
D)  GDP will be less than the total value of expenditures on final goods and services in the economy.

Question 3

In periods when prices are falling on average

Accepted Answer

A)  real GDP will grow slower than nominal GDP. 
B)  real GDP will grow faster than nominal GDP. 
C)  real GDP will grow as fast as nominal GDP. 
D)  we cannot calculate real GDP. 
A)  real GDP will grow slower than nominal GDP. 
B)  real GDP will grow faster than nominal GDP. 
C)  real GDP will grow as fast as nominal GDP. 
D)  we cannot calculate real GDP.

Question 4

Suppose that a very simple economy produces three goods: pizzas,haircuts and backpacks.Suppose the quantities produced and their corresponding prices for 2009 and 2013 are shown in the table:   Use the information to compute real GDP in the years 2009 and 2013.Calculate real GDP in 2013 assuming the base year is 2009.Real GDP is found by valuing GDP in a particular year using base year prices.When 2009 is the base year,real GDP for 2013 is found by multiplying 2009 prices by 2013 quantities and then adding the values up.Do the same calculation assuming the base year is 2013.Are the calculations different? Why?

Accepted Answer

Real GDP is found by valuing GDP in a pa

Question 5

What are the three methods of calculating GDP used by the Australian Bureau of Statistics,and define each method.

Accepted Answer

The production method: The sum of the va

Question 6

Labour productivity increases when capital stock per person falls,as there is a trade-off between capital and labour.

Accepted Answer

A) True 
 B)False

Question 7

The components of the expenditure method of measuring GDP include all of the following except

Accepted Answer

A)  net exports. 
B)  changes in stocks of inventories. 
C)  government purchases. 
D)  unpaid household work. 
A)  net exports. 
B)  changes in stocks of inventories. 
C)  government purchases. 
D)  unpaid household work.

Question 8

Gross domestic product is the total market value of all

Accepted Answer

A)  intermediate and final goods and services produced in a time period within a country. 
B)  final goods and services produced in a time period within a country. 
C)  goods but not services produced in a time period within a country. 
D)  final goods and services produced in a time period by citizens of a country, both within the country and by citizens working overseas. 
A)  intermediate and final goods and services produced in a time period within a country. 
B)  final goods and services produced in a time period within a country. 
C)  goods but not services produced in a time period within a country. 
D)  final goods and services produced in a time period by citizens of a country, both within the country and by citizens working overseas.

Question 9

According to new growth theory,the market will lead firms to accumulate the efficient level of knowledge capital.

Accepted Answer

A) True 
 B)False

Question 10

GDP is not a perfect measure of wellbeing because

Accepted Answer

A)  the value of leisure is included in GDP. 
B)  GDP is not adjusted for the effects of pollution. 
C)  GDP is adjusted for changes in crime. 
D)  GDP is adjusted for increases in drug addiction. 
A)  the value of leisure is included in GDP. 
B)  GDP is not adjusted for the effects of pollution. 
C)  GDP is adjusted for changes in crime. 
D)  GDP is adjusted for increases in drug addiction.

Question 11

Investment spending includes spending on

Accepted Answer

A)  taxes. 
B)  non-durable goods. 
C)  changes in business inventories. 
D)  transfer payments. 
A)  taxes. 
B)  non-durable goods. 
C)  changes in business inventories. 
D)  transfer payments.

Question 12

Which of the following transactions would take place in the 'underground economy'?

Accepted Answer

A)  Elizabeth tells her mother she's going to work but really goes to see a movie. 
B)  Paul buys 15 litres of petrol for $1.45 per litre, not realising that 40 cents per litre of that price goes to the government as tax revenue. 
C)  John makes chain-link belts and necklaces and sells them at a local market for cash to avoid paying taxes. 
D)  Matt bought an iPhone for $400 but decided to sell it on eBay instead of keeping it. 
A)  Elizabeth tells her mother she's going to work but really goes to see a movie. 
B)  Paul buys 15 litres of petrol for $1.45 per litre, not realising that 40 cents per litre of that price goes to the government as tax revenue. 
C)  John makes chain-link belts and necklaces and sells them at a local market for cash to avoid paying taxes. 
D)  Matt bought an iPhone for $400 but decided to sell it on eBay instead of keeping it.

Question 13

The Australian Bureau of Statistics divides its statistics on GDP into four major categories.List the categories of expenditures and describe each.

Accepted Answer

The largest category of expenditure is c

Question 14

If Anton sells his 1996 Honda Civic for $3500 in 2013,the sale of his car contributes $3500 to GDP in 2013.

Accepted Answer

A) True 
 B)False

Question 15

Refer to Table 12.2 for the following questions.
Table 12.2
  
-Refer to Table 12.2.What can we say has happened in the economy from 2012 and 2013?

Accepted Answer

A)  The price level has fallen. 
B)  The price level has risen. 
C)  The price level has remained constant. 
D)  Not enough information is available to determine what has happened to prices. 
A)  The price level has fallen. 
B)  The price level has risen. 
C)  The price level has remained constant. 
D)  Not enough information is available to determine what has happened to prices.

Question 16

The GDP deflator is equal to

Accepted Answer

A)  real GDP divided by nominal GDP. 
B)  nominal GDP divided by real GDP. 
C)  real GDP divided by nominal GDP multiplied by 100. 
D)  nominal GDP divided by real GDP multiplied by 100. 
A)  real GDP divided by nominal GDP. 
B)  nominal GDP divided by real GDP. 
C)  real GDP divided by nominal GDP multiplied by 100. 
D)  nominal GDP divided by real GDP multiplied by 100.

Question 17

If the per-worker production function shifts up

Accepted Answer

A)  it now takes more capital per hour worked to get the same amount of real GDP per hour worked. 
B)  an economy can increase its real GDP per hour worked without changing the level of capital per hour worked. 
C)  the per-worker production function becomes flatter. 
D)  negative technological change has occurred in the economy. 
A)  it now takes more capital per hour worked to get the same amount of real GDP per hour worked. 
B)  an economy can increase its real GDP per hour worked without changing the level of capital per hour worked. 
C)  the per-worker production function becomes flatter. 
D)  negative technological change has occurred in the economy.

Question 18

Using the information in the following table,calculate the rate of increase in the price level from 2013 to 2014.Use the percentage change in the GDP deflator.

Accepted Answer

To calculate the rate of change of price

Question 19

Given the following information,calculate the GDP deflator for both 2012 and 2013.
   What does the value of the deflator in the year 2012 tell you about that year with respect to the base year? What happened to prices in 2013 as compared to 2012?

Accepted Answer

To calculate the GDP deflator for 2012 a

Question 20

GDP is

Accepted Answer

A)  the value of all final goods and services produced in a country during a given time period. 
B)  the sum of consumption, investment, government spending and net exports during a given time period. 
C)  the sum of the market value of final production, rather than the quantity of production, during a given time period. 
D)  All of these options are correct. 
A)  the value of all final goods and services produced in a country during a given time period. 
B)  the sum of consumption, investment, government spending and net exports during a given time period. 
C)  the sum of the market value of final production, rather than the quantity of production, during a given time period. 
D)  All of these options are correct.

To make the calculation of real GDP more accurate,the Australian Bureau of Statistics (ABS)switched to using

The circular-flow diagram shows that

In periods when prices are falling on average

What are the three methods of calculating GDP used by the Australian Bureau of Statistics,and define each method.

Labour productivity increases when capital stock per person falls,as there is a trade-off between capital and labour.

The components of the expenditure method of measuring GDP include all of the following except

Gross domestic product is the total market value of all

According to new growth theory,the market will lead firms to accumulate the efficient level of knowledge capital.

GDP is not a perfect measure of wellbeing because

Investment spending includes spending on

Which of the following transactions would take place in the 'underground economy'?

The Australian Bureau of Statistics divides its statistics on GDP into four major categories.List the categories of expenditures and describe each.

If Anton sells his 1996 Honda Civic for $3500 in 2013,the sale of his car contributes $3500 to GDP in 2013.

Refer to Table 12.2 for the following questions. Table 12.2 -Refer to Table 12.2.What can we say has happened in the economy from 2012 and 2013?

The GDP deflator is equal to

If the per-worker production function shifts up

Using the information in the following table,calculate the rate of increase in the price level from 2013 to 2014.Use the percentage change in the GDP deflator.

Given the following information,calculate the GDP deflator for both 2012 and 2013. What does the value of the deflator in the year 2012 tell you about that year with respect to the base year? What happened to prices in 2013 as compared to 2012?

GDP is

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Healthcare

Firms,the Stock Market,and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust

Monopolistic Competition and Oligopoly

Unemployment and Inflation

Economic Growth, the Financial System and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Exam 12: GDP: Measuring Total Production and Income

To make the calculation of real GDP more accurate,the Australian Bureau of Statistics (ABS)switched to using

The circular-flow diagram shows that

In periods when prices are falling on average

What are the three methods of calculating GDP used by the Australian Bureau of Statistics,and define each method.

Labour productivity increases when capital stock per person falls,as there is a trade-off between capital and labour.

The components of the expenditure method of measuring GDP include all of the following except

Gross domestic product is the total market value of all

According to new growth theory,the market will lead firms to accumulate the efficient level of knowledge capital.

GDP is not a perfect measure of wellbeing because

Investment spending includes spending on

Which of the following transactions would take place in the 'underground economy'?

The Australian Bureau of Statistics divides its statistics on GDP into four major categories.List the categories of expenditures and describe each.

If Anton sells his 1996 Honda Civic for $3500 in 2013,the sale of his car contributes $3500 to GDP in 2013.

Refer to Table 12.2 for the following questions. Table 12.2 -Refer to Table 12.2.What can we say has happened in the economy from 2012 and 2013?

The GDP deflator is equal to

If the per-worker production function shifts up

Using the information in the following table,calculate the rate of increase in the price level from 2013 to 2014.Use the percentage change in the GDP deflator.

Given the following information,calculate the GDP deflator for both 2012 and 2013. What does the value of the deflator in the year 2012 tell you about that year with respect to the base year? What happened to prices in 2013 as compared to 2012?

GDP is

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Healthcare

Firms,the Stock Market,and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust

Monopolistic Competition and Oligopoly

Unemployment and Inflation

Economic Growth, the Financial System and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters