Question 1

An example of investment spending is the purchase of a:

Accepted Answer

A)  bond by a banker. 
B)  loaf of bread by your aunt. 
C)  new tractor by a farmer. 
D)  ticket to a football game by a student. 
A)  bond by a banker. 
B)  loaf of bread by your aunt. 
C)  new tractor by a farmer. 
D)  ticket to a football game by a student.

Question 2

Goods that are produced in a particular period but NOT sold in that period:

Accepted Answer

A)  count as consumption in the next year. 
B)  are included in investment. 
C)  are treated like exports. 
D)  are classified as purely financial transactions. 
A)  count as consumption in the next year. 
B)  are included in investment. 
C)  are treated like exports. 
D)  are classified as purely financial transactions.

Question 3

Government economists have adopted the _____ method of calculating the change in real GDP,which averages the GDP growth rate according to both an early base year and a late base year.

Accepted Answer

A)  cost indexation 
B)  straight-line depreciation 
C)  chain-linking 
D)  fixed base year 
A)  cost indexation 
B)  straight-line depreciation 
C)  chain-linking 
D)  fixed base year

Question 4

Assume that the consumer price index for 2009 was 72.6 and for 2010 was 82.4.What was the inflation rate between the two years?

Accepted Answer

A)  0.88% 
B)  9.8% 
C)  11.9% 
D)  13.5% 
A)  0.88% 
B)  9.8% 
C)  11.9% 
D)  13.5%

Question 5

Use the following to answer question 245:  
-(Table: CPI)Use Table: CPI.Suppose only bread,laptops,and movies are produced in this economy.Calculate the consumer price index of 2012,using 2008 as the base year.

Accepted Answer

A)  81.9 
B)  100 
C)  75.8 
D)  95 
A)  81.9 
B)  100 
C)  75.8 
D)  95

Question 6

If real GDP falls when nominal GDP increases,then prices have fallen.

Accepted Answer

A) True 
 B)False

Question 7

Firms supply resources in the factor markets.

Accepted Answer

A) True 
 B)False

Question 8

If nominal GDP increases from $10 trillion to $12 trillion in a year,it could mean that aggregate output grew by 20%,that prices increased 20%,or that prices and aggregate output both increased.

Accepted Answer

A) True 
 B)False

Question 9

Which transaction will be included in the official measurement of GDP?

Accepted Answer

A)  Stan sold his 2015 Honda to his sister. 
B)  Monica illegally downloaded movies to her laptop. 
C)  Ben bought a textbook from his friend who took the class last semester. 
D)  Sean bought a new truck. 
A)  Stan sold his 2015 Honda to his sister. 
B)  Monica illegally downloaded movies to her laptop. 
C)  Ben bought a textbook from his friend who took the class last semester. 
D)  Sean bought a new truck.

Question 10

Net exports are calculated by subtracting:

Accepted Answer

A)  imports from exports. 
B)  exports from imports. 
C)  out all intermediate goods. 
D)  I,G,and value added from GDP. 
A)  imports from exports. 
B)  exports from imports. 
C)  out all intermediate goods. 
D)  I,G,and value added from GDP.

Question 11

Use the following to answer questions:  
-(Figure 7-2: Expanded Circular-Flow Model)Use Figure 7-2: Expanded Circular-Flow Model.The flow of funds into and out of households is:

Accepted Answer

A)  $1 020. 
B)  $1 000. 
C)  $850. 
D)  $700. 
A)  $1 020. 
B)  $1 000. 
C)  $850. 
D)  $700.

Question 12

Which definition BEST describes GDP?

Accepted Answer

A)  the total value of all final goods and services produced in the economy during a given year 
B)  the total value of all goods and services produced in the economy during a given year 
C)  the total value of all primary,intermediate,and final goods and services produced in the economy during a given year 
D)  the total value of all goods and services produced and sold in the economy during a given year 
A)  the total value of all final goods and services produced in the economy during a given year 
B)  the total value of all goods and services produced in the economy during a given year 
C)  the total value of all primary,intermediate,and final goods and services produced in the economy during a given year 
D)  the total value of all goods and services produced and sold in the economy during a given year

Question 13

A nation's exports minus its imports:

Accepted Answer

A)  equals its private investment. 
B)  is net exports. 
C)  is always a positive number. 
D)  is equal to net transfer payments. 
A)  equals its private investment. 
B)  is net exports. 
C)  is always a positive number. 
D)  is equal to net transfer payments.

Question 14

In the circular-flow diagram,households:

Accepted Answer

A)  supply goods. 
B)  supply services. 
C)  supply resources. 
D)  buy resources. 
A)  supply goods. 
B)  supply services. 
C)  supply resources. 
D)  buy resources.

Question 15

Firms demand goods and services in the product markets.

Accepted Answer

A) True 
 B)False

Question 16

The national income and product accounts keep track of:

Accepted Answer

A)  consumer debt. 
B)  sales and investment spending by businesses. 
C)  worker productivity. 
D)  unemployment rates. 
A)  consumer debt. 
B)  sales and investment spending by businesses. 
C)  worker productivity. 
D)  unemployment rates.

Question 17

Gross domestic product is the economy's total production of _____ for a given period.

Accepted Answer

A)  goods and services 
B)  final goods and services 
C)  intermediate goods and services 
D)  consumer goods and services 
A)  goods and services 
B)  final goods and services 
C)  intermediate goods and services 
D)  consumer goods and services

Question 18

Use the following to answer questions:  
-The total value of all final goods and services produced in a given year,calculated using the prices of a selected base year,is:

Accepted Answer

A)  real GDP. 
B)  nominal GDP. 
C)  net exports. 
D)  consumption spending. 
A)  real GDP. 
B)  nominal GDP. 
C)  net exports. 
D)  consumption spending.

Question 19

Use the following to answer questions:  
-(Table: Peanut Butter and Jelly)Use Table: Peanut Butter and Jelly.Suppose a market basket consists of 20 jars of peanut butter and 10 jars of jelly.What is the value of the market basket in 2013?

Accepted Answer

A)  $3.35 
B)  $40 
C)  $42 
D)  $44.50 
A)  $3.35 
B)  $40 
C)  $42 
D)  $44.50

Question 20

Use the following to answer questions:  
-(Table: Lemonade and Cookies)Use Table: Lemonade and Cookies.Assume that an economy produces only lemonade and cookies.The growth rate of nominal GDP from 2013 to 2014 was _____%.

Accepted Answer

A)  5 
B)  10 
C)  11.25 
D)  45 
A)  5 
B)  10 
C)  11.25 
D)  45

An example of investment spending is the purchase of a:

Goods that are produced in a particular period but NOT sold in that period:

Government economists have adopted the _____ method of calculating the change in real GDP,which averages the GDP growth rate according to both an early base year and a late base year.

Assume that the consumer price index for 2009 was 72.6 and for 2010 was 82.4.What was the inflation rate between the two years?

Use the following to answer question 245: -(Table: CPI)Use Table: CPI.Suppose only bread,laptops,and movies are produced in this economy.Calculate the consumer price index of 2012,using 2008 as the base year.

If real GDP falls when nominal GDP increases,then prices have fallen.

Firms supply resources in the factor markets.

If nominal GDP increases from $10 trillion to $12 trillion in a year,it could mean that aggregate output grew by 20%,that prices increased 20%,or that prices and aggregate output both increased.

Which transaction will be included in the official measurement of GDP?

Net exports are calculated by subtracting:

Use the following to answer questions: -(Figure 7-2: Expanded Circular-Flow Model)Use Figure 7-2: Expanded Circular-Flow Model.The flow of funds into and out of households is:

Which definition BEST describes GDP?

A nation's exports minus its imports:

In the circular-flow diagram,households:

Firms demand goods and services in the product markets.

The national income and product accounts keep track of:

Gross domestic product is the economy's total production of _____ for a given period.

Use the following to answer questions: -The total value of all final goods and services produced in a given year,calculated using the prices of a selected base year,is:

Use the following to answer questions: -(Table: Peanut Butter and Jelly)Use Table: Peanut Butter and Jelly.Suppose a market basket consists of 20 jars of peanut butter and 10 jars of jelly.What is the value of the market basket in 2013?

Use the following to answer questions: -(Table: Lemonade and Cookies)Use Table: Lemonade and Cookies.Assume that an economy produces only lemonade and cookies.The growth rate of nominal GDP from 2013 to 2014 was _____%.

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

An example of investment spending is the purchase of a:

Goods that are produced in a particular period but NOT sold in that period:

Government economists have adopted the _____ method of calculating the change in real GDP,which averages the GDP growth rate according to both an early base year and a late base year.

Assume that the consumer price index for 2009 was 72.6 and for 2010 was 82.4.What was the inflation rate between the two years?

Use the following to answer question 245: -(Table: CPI)Use Table: CPI.Suppose only bread,laptops,and movies are produced in this economy.Calculate the consumer price index of 2012,using 2008 as the base year.

If real GDP falls when nominal GDP increases,then prices have fallen.

Firms supply resources in the factor markets.

If nominal GDP increases from $10 trillion to $12 trillion in a year,it could mean that aggregate output grew by 20%,that prices increased 20%,or that prices and aggregate output both increased.

Which transaction will be included in the official measurement of GDP?

Net exports are calculated by subtracting:

Use the following to answer questions: -(Figure 7-2: Expanded Circular-Flow Model)Use Figure 7-2: Expanded Circular-Flow Model.The flow of funds into and out of households is:

Which definition BEST describes GDP?

A nation's exports minus its imports:

In the circular-flow diagram,households:

Firms demand goods and services in the product markets.

The national income and product accounts keep track of:

Gross domestic product is the economy's total production of _____ for a given period.

Use the following to answer questions: -The total value of all final goods and services produced in a given year,calculated using the prices of a selected base year,is:

Use the following to answer questions: -(Table: Peanut Butter and Jelly)Use Table: Peanut Butter and Jelly.Suppose a market basket consists of 20 jars of peanut butter and 10 jars of jelly.What is the value of the market basket in 2013?

Use the following to answer questions: -(Table: Lemonade and Cookies)Use Table: Lemonade and Cookies.Assume that an economy produces only lemonade and cookies.The growth rate of nominal GDP from 2013 to 2014 was _____%.

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