Question 1

Table 5-1
The table below contains data for country A for the year 2010.
  
-Refer to Table 5-1. What were country A's net exports in 2010?

Accepted Answer

A)  -$32 
B)  $32 
C)  $88 
D)  $120 
A)  -$32 
B)  $32 
C)  $88 
D)  $120

Question 2

GDP is not a perfect measure of well-being; for example,

Accepted Answer

A)  GDP incorporates a large number of non-market goods and services that are of little value to society. 
B)  GDP places too much emphasis on the value of leisure. 
C)  GDP fails to account for the quality of the environment. 
D)  All of the above are correct. 
A)  GDP incorporates a large number of non-market goods and services that are of little value to society. 
B)  GDP places too much emphasis on the value of leisure. 
C)  GDP fails to account for the quality of the environment. 
D)  All of the above are correct.

Question 3

During the third quarter of this year a firm produces consumer goods and adds some of those goods to its inventory. During the fourth quarter of this year, the firm sells the goods at a retail outlet, with the result that the value of its inventory at the end of the fourth quarter is smaller than the value of its inventory at the end of the third quarter. These actions affect which component(s) of fourth-quarter GDP?

Accepted Answer

A)  they increase consumption and have no affect on investment 
B)  they increase consumption and decrease investment 
C)  they have no affect on either consumption or investment 
D)  they have no affect on consumption and decrease investment 
A)  they increase consumption and have no affect on investment 
B)  they increase consumption and decrease investment 
C)  they have no affect on either consumption or investment 
D)  they have no affect on consumption and decrease investment

Question 4

Tom and Lilly rented a house for $12,000 last year. At the start of the year they bought the house they had been renting directly from the owner for $250,000. They believe they could rent it for $12,000 this year, but stay in the house. How much does Tom and Lilly's decision to buy the house change GDP?

Accepted Answer

A)  it reduces GDP by $12,000 
B)  it does not change GDP 
C)  it raises GDP by $238,000 
D)  it raises GDP by $250,000 
A)  it reduces GDP by $12,000 
B)  it does not change GDP 
C)  it raises GDP by $238,000 
D)  it raises GDP by $250,000

Question 5

Typically in countries with lower levels of real GDP person, a smaller percentage of the population is literate.

Accepted Answer

A) True 
 B)False

Question 6

The term real GDP refers to a country's actual GDP as opposed to its estimated GDP.

Accepted Answer

A) True 
 B)False

Question 7

In the economy of Ukzten in 2010, consumption was $1000, exports were $100, government purchases were $450, imports were $150, and investment was $350. What was Ukzten's GDP in 2010?

Accepted Answer

A)  $1750 
B)  $1850 
C)  $1900 
D)  $2050 
A)  $1750 
B)  $1850 
C)  $1900 
D)  $2050

Question 8

Estimates of the values of which of the following non-market goods or services are included in GDP?

Accepted Answer

A)  the value of unpaid housework 
B)  the value of services provided by major household appliances purchased in a previous period 
C)  the estimated rental value of owner-occupied homes 
D)  All of the above are included in GDP. 
A)  the value of unpaid housework 
B)  the value of services provided by major household appliances purchased in a previous period 
C)  the estimated rental value of owner-occupied homes 
D)  All of the above are included in GDP.

Question 9

GDP is used as the basic measure of a society's economic well-being. A better measure of the economic well-being of individuals in society is

Accepted Answer

A)  saving per person. 
B)  GDP per person. 
C)  government expenditures per person. 
D)  investment per business firm. 
A)  saving per person. 
B)  GDP per person. 
C)  government expenditures per person. 
D)  investment per business firm.

Question 10

Suppose that over the last twenty-five years a country's nominal GDP grew to three times its former size. In the meantime, population grew by 40 percent and prices rose by 100 percent. What happened to real GDP per person?

Accepted Answer

A)  It more than doubled. 
B)  It increased, but it less than doubled. 
C)  It was unchanged. 
D)  It decreased. 
A)  It more than doubled. 
B)  It increased, but it less than doubled. 
C)  It was unchanged. 
D)  It decreased.

Question 11

Table 5-4
The country of Caspir produces only cereal and milk. Quantities and prices of these goods for the last several years are shown below. The base year is 2008.
Prices and Quantities
  
-Refer to Table 5-4. In 2010, this country's

Accepted Answer

A)  real GDP was $780, and the GDP deflator was 141.0. 
B)  real GDP was $825, and the GDP deflator was 133.3. 
C)  real GDP was $780, and the GDP deflator was 133.3 
D)  real GDP was $825, and the GDP deflator was 141.0 
A)  real GDP was $780, and the GDP deflator was 141.0. 
B)  real GDP was $825, and the GDP deflator was 133.3. 
C)  real GDP was $780, and the GDP deflator was 133.3 
D)  real GDP was $825, and the GDP deflator was 141.0

Question 12

U.S. GDP and U.S. GNP are related as follows:

Accepted Answer

A)  GNP = GDP + Value of exported goods - Value of imported goods. 
B)  GNP = GDP - Value of exported goods + Value of imported goods. 
C)  GNP = GDP + Income earned by foreigners in the U.S. - Income earned by U.S. citizens abroad. 
D)  GNP = GDP - Income earned by foreigners in the U.S. + Income earned by U.S. citizens abroad. 
A)  GNP = GDP + Value of exported goods - Value of imported goods. 
B)  GNP = GDP - Value of exported goods + Value of imported goods. 
C)  GNP = GDP + Income earned by foreigners in the U.S. - Income earned by U.S. citizens abroad. 
D)  GNP = GDP - Income earned by foreigners in the U.S. + Income earned by U.S. citizens abroad.

Question 13

If the price of a Blu-Ray Disc player is three times the price of an MP3 player, then a Blue-Ray Disc player contributes

Accepted Answer

A)  more than three times as much to GDP as does a MP3 player. 
B)  less than three times as much to GDP as does a MP3 player. 
C)  exactly three times as much to GDP as does a MP3 player. 
D)  None of the above is necessarily correct. 
A)  more than three times as much to GDP as does a MP3 player. 
B)  less than three times as much to GDP as does a MP3 player. 
C)  exactly three times as much to GDP as does a MP3 player. 
D)  None of the above is necessarily correct.

Question 14

If real GDP is 5,100 and nominal GDP is 4,900, then the GDP deflator is

Accepted Answer

A)  104.1 so prices are higher than in the base year. 
B)  104.1 so prices are lower than in the base year. 
C)  96.1 so prices are higher than in the base year. 
D)  96.1 so prices are lower than in the base year. 
A)  104.1 so prices are higher than in the base year. 
B)  104.1 so prices are lower than in the base year. 
C)  96.1 so prices are higher than in the base year. 
D)  96.1 so prices are lower than in the base year.

Question 15

Which of the following items is included in GDP?

Accepted Answer

A)  the sale of stocks and bonds 
B)  the sale of used goods 
C)  the sale of services such as those performed by a doctor 
D)  All of the above are included in GDP. 
A)  the sale of stocks and bonds 
B)  the sale of used goods 
C)  the sale of services such as those performed by a doctor 
D)  All of the above are included in GDP.

Question 16

In the economy of Ukzten in 2010, consumption was $2000, exports were $800, GDP was $4800, government purchases were $840, and investment was $1400. What were Ukzten's imports in 2010?

Accepted Answer

A)  -$560 
B)  -$240 
C)  $240 
D)  $560 
A)  -$560 
B)  -$240 
C)  $240 
D)  $560

Question 17

When an American household purchases a bottle of Italian wine for $100,

Accepted Answer

A)  U.S. consumption does not change, U.S. net exports decrease by $100, and U.S. GDP decreases by $100. 
B)  U.S. consumption does not change, U.S. net exports increase by $100, and U.S. GDP increases by $100. 
C)  U.S. consumption increases by $100, U.S. net exports decrease by $100, and U.S. GDP does not change. 
D)  U.S. consumption increases by $100, U.S. net exports do not change, and U.S. GDP increases by $100. 
A)  U.S. consumption does not change, U.S. net exports decrease by $100, and U.S. GDP decreases by $100. 
B)  U.S. consumption does not change, U.S. net exports increase by $100, and U.S. GDP increases by $100. 
C)  U.S. consumption increases by $100, U.S. net exports decrease by $100, and U.S. GDP does not change. 
D)  U.S. consumption increases by $100, U.S. net exports do not change, and U.S. GDP increases by $100.

Question 18

U.S. GDP includes the market value of rental housing, but not the market value of owner-occupied housing services.

Accepted Answer

A) True 
 B)False

Question 19

Table 5-1
The table below contains data for Bahkan for the year 2010.
  
-Refer to Table 5-1. Net national product for Bahkan in 2010 is

Accepted Answer

A)  $96 
B)  $104 
C)  $106 
D)  $116 
A)  $96 
B)  $104 
C)  $106 
D)  $116

Question 20

If nominal GDP is $10 trillion and real GDP is $12 trillion, then the GDP deflator is

Accepted Answer

A)  83.33, and this indicates that the price level has decreased by 16.67 percent since the base year. 
B)  83.33, and this indicates that the price level has increased by 83.33 percent since the base year. 
C)  120, and this indicates that the price level has increased by 20 percent since the base year. 
D)  120, and this indicates that the price level has increased by 120 percent since the base year. 
A)  83.33, and this indicates that the price level has decreased by 16.67 percent since the base year. 
B)  83.33, and this indicates that the price level has increased by 83.33 percent since the base year. 
C)  120, and this indicates that the price level has increased by 20 percent since the base year. 
D)  120, and this indicates that the price level has increased by 120 percent since the base year.

Table 5-1 The table below contains data for country A for the year 2010. -Refer to Table 5-1. What were country A's net exports in 2010?

GDP is not a perfect measure of well-being; for example,

Typically in countries with lower levels of real GDP person, a smaller percentage of the population is literate.

The term real GDP refers to a country's actual GDP as opposed to its estimated GDP.

In the economy of Ukzten in 2010, consumption was $1000, exports were $100, government purchases were $450, imports were $150, and investment was $350. What was Ukzten's GDP in 2010?

Estimates of the values of which of the following non-market goods or services are included in GDP?

GDP is used as the basic measure of a society's economic well-being. A better measure of the economic well-being of individuals in society is

Suppose that over the last twenty-five years a country's nominal GDP grew to three times its former size. In the meantime, population grew by 40 percent and prices rose by 100 percent. What happened to real GDP per person?

Table 5-4 The country of Caspir produces only cereal and milk. Quantities and prices of these goods for the last several years are shown below. The base year is 2008. Prices and Quantities -Refer to Table 5-4. In 2010, this country's

U.S. GDP and U.S. GNP are related as follows:

If the price of a Blu-Ray Disc player is three times the price of an MP3 player, then a Blue-Ray Disc player contributes

If real GDP is 5,100 and nominal GDP is 4,900, then the GDP deflator is

Which of the following items is included in GDP?

In the economy of Ukzten in 2010, consumption was $2000, exports were $800, GDP was $4800, government purchases were $840, and investment was $1400. What were Ukzten's imports in 2010?

When an American household purchases a bottle of Italian wine for $100,

U.S. GDP includes the market value of rental housing, but not the market value of owner-occupied housing services.

Table 5-1 The table below contains data for Bahkan for the year 2010. -Refer to Table 5-1. Net national product for Bahkan in 2010 is

If nominal GDP is $10 trillion and real GDP is $12 trillion, then the GDP deflator is

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomic Models

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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Exam 5: Measuring a Nations Income

Table 5-1 The table below contains data for country A for the year 2010. -Refer to Table 5-1. What were country A's net exports in 2010?

GDP is not a perfect measure of well-being; for example,

Typically in countries with lower levels of real GDP person, a smaller percentage of the population is literate.

The term real GDP refers to a country's actual GDP as opposed to its estimated GDP.

In the economy of Ukzten in 2010, consumption was $1000, exports were $100, government purchases were $450, imports were $150, and investment was $350. What was Ukzten's GDP in 2010?

Estimates of the values of which of the following non-market goods or services are included in GDP?

GDP is used as the basic measure of a society's economic well-being. A better measure of the economic well-being of individuals in society is

Suppose that over the last twenty-five years a country's nominal GDP grew to three times its former size. In the meantime, population grew by 40 percent and prices rose by 100 percent. What happened to real GDP per person?

Table 5-4 The country of Caspir produces only cereal and milk. Quantities and prices of these goods for the last several years are shown below. The base year is 2008. Prices and Quantities -Refer to Table 5-4. In 2010, this country's

U.S. GDP and U.S. GNP are related as follows:

If the price of a Blu-Ray Disc player is three times the price of an MP3 player, then a Blue-Ray Disc player contributes

If real GDP is 5,100 and nominal GDP is 4,900, then the GDP deflator is

Which of the following items is included in GDP?

In the economy of Ukzten in 2010, consumption was $2000, exports were $800, GDP was $4800, government purchases were $840, and investment was $1400. What were Ukzten's imports in 2010?

When an American household purchases a bottle of Italian wine for $100,

U.S. GDP includes the market value of rental housing, but not the market value of owner-occupied housing services.

Table 5-1 The table below contains data for Bahkan for the year 2010. -Refer to Table 5-1. Net national product for Bahkan in 2010 is

If nominal GDP is $10 trillion and real GDP is $12 trillion, then the GDP deflator is

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomic Models

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters