Exam 5: Measuring a Nations Income

A country reported nominal GDP of $100 billion in 2010 and $75 billion in 2009. It also reported a GDP deflator of 125 in 2010 and 120 in 2009. Between 2009 and 2010,

Economists use the term inflation to describe a situation in which the economy's overall production level is rising.

GDP

GDP can measure either the total income of everyone in the economy or the total expenditure on the economy's output of goods and services, but GDP cannot measure both at the same time.

National income is defined as

The information for 2008 in millions in the table below was reported by the World Bank. On the basis of this information, which list below contains the correct ordering of real GDP per person from highest to lowest? Country GDP (Constant US$) GDP(Current US$) Population Germany 2,091,573 3,649,493 82)11 Japan 5,166,281 4,910,839 127)70 u.S. 11,513,872 14,093,309 304)06

The goal of macroeconomics is to explain the economic changes that affect many households, firms, and markets simultaneously.

Changes in real GDP reflect only changes in the amounts being produced.

In the economy of Ukzten in 2010, consumption was $6000, exports were $1000, GDP was $10,000, government purchases were $2000, and imports were $600. What was Ukzten's investment in 2010?

A U.S. firm produces nail guns in the first quarter of 2010 and adds them to its inventory. In the second quarter of 2010 the firm sells the nail guns to a U.S. construction company. In which quarter(s) is (are) GDP higher?

If nominal GDP is $12,000 and the GDP deflator is 80, then real GDP is $15,000.

Which of the following statements about nominal GDP and real GDP is correct?

Many things that society values, such as good health, high-quality education, enjoyable recreation opportunities, and desirable moral attributes of the population, are not measured as part of GDP. It follows that

The GDP deflator is the ratio of

If a U.S. company buys an electrical generator made in Japan by a Japanese firm, and the Japanese firm uses the payment to buy stocks issued by a U.S. company then

Ralph pays someone to mow his lawn, while Mike mows his own lawn. Regarding these two practices, which of the following statements is correct?

Table 5-6 The table below contains data for the country of Batterland, which produces only waffles and pancakes. The base year is 2009. Prices and Quantities -Refer to Table 5-6. From 2010 to 2011, this country's output grew

For monitoring fluctuations in the national economy, which measure of income is best?

In the economy of Ukzten in 2010, exports were $200, GDP was $2000, government purchases were $300, imports were $130, and investment was $400. What was Ukzten's consumption in 2010?

The government computes measures of income other than GDP because these other measures usually tell different stories about overall economic conditions.