Question 1

A laptop computer that is purchased by an accounting firm is considered to be:

Accepted Answer

A)  consumption spending. 
B)  investment spending. 
C)  private saving. 
D)  a pre-tax dividend. 
A)  consumption spending. 
B)  investment spending. 
C)  private saving. 
D)  a pre-tax dividend.

Question 2

Use the following to answer questions:  
-Real GDP is nominal GDP adjusted for:

Accepted Answer

A)  double-counting. 
B)  changes in prices. 
C)  population. 
D)  imports. 
A)  double-counting. 
B)  changes in prices. 
C)  population. 
D)  imports.

Question 3

Income tax brackets are indexed to the consumer price index.

Accepted Answer

A) True 
 B)False

Question 4

Use the following to answer questions:  
-The inflation-adjusted measure of aggregate output typically used by economists is called:

Accepted Answer

A)  aggregate output. 
B)  nominal gross national product. 
C)  net domestic product. 
D)  real gross domestic product. 
A)  aggregate output. 
B)  nominal gross national product. 
C)  net domestic product. 
D)  real gross domestic product.

Question 5

Use the following to answer questions:  
-(Table: Per Capita GDP)Use Table: Per Capita GDP.Per capita nominal GDP in 2014 was:

Accepted Answer

A)  $600. 
B)  $800. 
C)  $300. 
D)  $1 600. 
A)  $600. 
B)  $800. 
C)  $300. 
D)  $1 600.

Question 6

Economists frequently use GDP per capita to reflect:

Accepted Answer

A)  the impact of prices on GDP. 
B)  differences in living standards across countries. 
C)  people who are employed. 
D)  both people who are employed and those who are unemployed. 
A)  the impact of prices on GDP. 
B)  differences in living standards across countries. 
C)  people who are employed. 
D)  both people who are employed and those who are unemployed.

Question 7

The consumer price index measures the cost of the consumption of a family of four living below the poverty line.

Accepted Answer

A) True 
 B)False

Question 8

Purchases of _____ are included in GDP.

Accepted Answer

A)  used goods 
B)  newly issued stocks 
C)  new foreign-produced investment goods 
D)  new capital goods 
A)  used goods 
B)  newly issued stocks 
C)  new foreign-produced investment goods 
D)  new capital goods

Question 9

The total volume of business sales in the economy is much larger than GDP because:

Accepted Answer

A)  GDP understates the value of total output. 
B)  the output approach to measuring GDP excludes intermediate transactions. 
C)  GDP includes transfer payments. 
D)  GDP excludes exports. 
A)  GDP understates the value of total output. 
B)  the output approach to measuring GDP excludes intermediate transactions. 
C)  GDP includes transfer payments. 
D)  GDP excludes exports.

Question 10

The inflation or deflation rate is:

Accepted Answer

A)  the change in a price index divided by the initial value of the index. 
B)  the change in a price index divided by the new index number. 
C)  the difference between the initial price index number and the new price index number. 
D)  computed by dividing the old price index number by the new price index number. 
A)  the change in a price index divided by the initial value of the index. 
B)  the change in a price index divided by the new index number. 
C)  the difference between the initial price index number and the new price index number. 
D)  computed by dividing the old price index number by the new price index number.

Question 11

The base period for the consumer price index is 1941-1945.

Accepted Answer

A) True 
 B)False

Question 12

Use the following to answer questions:  
-(Figure 7-1: Circular-Flow Model)Use Figure 7-1: Circular-Flow Model.If the circular-flow model is in equilibrium (the sum of money flowing into each box is equal to the sum of the money flowing out of it)and there is an increase in consumer spending,holding everything else constant,which outcome is likely to occur?

Accepted Answer

A)  an increase in GDP 
B)  a decrease in GDP 
C)  an increase in the unemployment rate 
D)  a decrease in the inflation rate 
A)  an increase in GDP 
B)  a decrease in GDP 
C)  an increase in the unemployment rate 
D)  a decrease in the inflation rate

Question 13

Use the following to answer questions:  
-(Table: Lemonade and Cookies)Use Table: Lemonade and Cookies.Assume that an economy produces only lemonade and cookies.Nominal GDP in 2013 was:

Accepted Answer

A)  $400. 
B)  $420. 
C)  $445. 
D)  $820. 
A)  $400. 
B)  $420. 
C)  $445. 
D)  $820.

Question 14

The consumer price index is intended to measure the cost of all goods purchased in the economy over time.

Accepted Answer

A) True 
 B)False

Question 15

Suppose that,in year 1,an economy produces 100 golf balls that sell for $3 each and 75 pizzas that sell for $8 each.The next year,the economy produces 110 golf balls that sell for $3.25 each and 80 pizzas that sell for $9 each.The value of nominal GDP in years 1 and 2,respectively,is:

Accepted Answer

A)  $900 and $1 077.50. 
B)  $900 and $990. 
C)  $180 000 and $257 400. 
D)  $1 000 and $1 005. 
A)  $900 and $1 077.50. 
B)  $900 and $990. 
C)  $180 000 and $257 400. 
D)  $1 000 and $1 005.

Question 16

Which equation is CORRECT?

Accepted Answer

A)  GDP = C + I + G + IM - X. 
B)  GDP = C + I + G + X - IM. 
C)  GDP = C + I + G + X + IM. 
D)  GDP = C + I + G - T + TR. 
A)  GDP = C + I + G + IM - X. 
B)  GDP = C + I + G + X - IM. 
C)  GDP = C + I + G + X + IM. 
D)  GDP = C + I + G - T + TR.

Question 17

Use the following to answer question :  
-(Table: Furniture Production Schedule)Use Table: Furniture Production Schedule.What is the total value added of all stages of production of the furniture?

Accepted Answer

A)  $800 
B)  $1 200 
C)  $1 800 
D)  $2 000 
A)  $800 
B)  $1 200 
C)  $1 800 
D)  $2 000

Question 18

Spending on food is the largest portion of the consumer price index.

Accepted Answer

A) True 
 B)False

Question 19

A market basket is a hypothetical set of consumer purchases of goods and services.

Accepted Answer

A) True 
 B)False

Question 20

If nominal GDP decreases from one year to the next,_____ must have fallen.

Accepted Answer

A)  prices 
B)  real GDP 
C)  prices and real GDP 
D)  real GDP or prices or both 
A)  prices 
B)  real GDP 
C)  prices and real GDP 
D)  real GDP or prices or both

A laptop computer that is purchased by an accounting firm is considered to be:

Use the following to answer questions: -Real GDP is nominal GDP adjusted for:

Income tax brackets are indexed to the consumer price index.

Use the following to answer questions: -The inflation-adjusted measure of aggregate output typically used by economists is called:

Use the following to answer questions: -(Table: Per Capita GDP)Use Table: Per Capita GDP.Per capita nominal GDP in 2014 was:

Economists frequently use GDP per capita to reflect:

The consumer price index measures the cost of the consumption of a family of four living below the poverty line.

Purchases of _____ are included in GDP.

The total volume of business sales in the economy is much larger than GDP because:

The inflation or deflation rate is:

The base period for the consumer price index is 1941-1945.

Use the following to answer questions: -(Table: Lemonade and Cookies)Use Table: Lemonade and Cookies.Assume that an economy produces only lemonade and cookies.Nominal GDP in 2013 was:

The consumer price index is intended to measure the cost of all goods purchased in the economy over time.

Suppose that,in year 1,an economy produces 100 golf balls that sell for $3 each and 75 pizzas that sell for $8 each.The next year,the economy produces 110 golf balls that sell for $3.25 each and 80 pizzas that sell for $9 each.The value of nominal GDP in years 1 and 2,respectively,is:

Which equation is CORRECT?

Use the following to answer question : -(Table: Furniture Production Schedule)Use Table: Furniture Production Schedule.What is the total value added of all stages of production of the furniture?

Spending on food is the largest portion of the consumer price index.

A market basket is a hypothetical set of consumer purchases of goods and services.

If nominal GDP decreases from one year to the next,_____ must have fallen.

First Principles

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Graphs in Economics

Filters

Exam 7: Gdp and the Cpi: Tracking the Macroeconomy

A laptop computer that is purchased by an accounting firm is considered to be:

Use the following to answer questions: -Real GDP is nominal GDP adjusted for:

Income tax brackets are indexed to the consumer price index.

Use the following to answer questions: -The inflation-adjusted measure of aggregate output typically used by economists is called:

Use the following to answer questions: -(Table: Per Capita GDP)Use Table: Per Capita GDP.Per capita nominal GDP in 2014 was:

Economists frequently use GDP per capita to reflect:

The consumer price index measures the cost of the consumption of a family of four living below the poverty line.

Purchases of _____ are included in GDP.

The total volume of business sales in the economy is much larger than GDP because:

The inflation or deflation rate is:

The base period for the consumer price index is 1941-1945.

Use the following to answer questions: -(Table: Lemonade and Cookies)Use Table: Lemonade and Cookies.Assume that an economy produces only lemonade and cookies.Nominal GDP in 2013 was:

The consumer price index is intended to measure the cost of all goods purchased in the economy over time.

Suppose that,in year 1,an economy produces 100 golf balls that sell for $3 each and 75 pizzas that sell for $8 each.The next year,the economy produces 110 golf balls that sell for $3.25 each and 80 pizzas that sell for $9 each.The value of nominal GDP in years 1 and 2,respectively,is:

Which equation is CORRECT?

Use the following to answer question : -(Table: Furniture Production Schedule)Use Table: Furniture Production Schedule.What is the total value added of all stages of production of the furniture?

Spending on food is the largest portion of the consumer price index.

A market basket is a hypothetical set of consumer purchases of goods and services.

If nominal GDP decreases from one year to the next,_____ must have fallen.

First Principles

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

Unemployment and Inflation

Long-Run Economic Growth

Savings, Investment Spending, and the Financial System

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Graphs in Economics

Filters