Question 1

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 2

In the economy of Talikastan in 2015, consumption was $600, exports were $300, GDP was $1300, government purchases were $250, and investment was $300. What were Talikastan's imports in 2015?

Accepted Answer

A)  -$150 
B)  -$200 
C)  $200 
D)  $150 
A)  -$150 
B)  -$200 
C)  $200 
D)  $150

Question 3

In a simple circular-flow diagram, firms use the money they get from a sale to

Accepted Answer

A)  pay wages to workers. 
B)  pay rent to landlords. 
C)  pay profit to the firms' owners. 
D)  All of the above are correct. 
A)  pay wages to workers. 
B)  pay rent to landlords. 
C)  pay profit to the firms' owners. 
D)  All of the above are correct.

Question 4

Which of the following items is included in U.S. GDP?

Accepted Answer

A)  the estimated value of production accomplished at home, such as backyard production of fruits and vegetables 
B)  the value of illegally-produced goods and services 
C)  the value of cars and trucks produced in foreign countries and sold in the U.S. 
D)  None of the above is included in U.S. GDP. 
A)  the estimated value of production accomplished at home, such as backyard production of fruits and vegetables 
B)  the value of illegally-produced goods and services 
C)  the value of cars and trucks produced in foreign countries and sold in the U.S. 
D)  None of the above is included in U.S. GDP.

Question 5

Which of the following is an example of a durable good?

Accepted Answer

A)  a hair dryer. 
B)  a suit. 
C)  a pair of shoes. 
D)  All of the above are correct. 
A)  a hair dryer. 
B)  a suit. 
C)  a pair of shoes. 
D)  All of the above are correct.

Question 6

If a U.S. citizen buys a dress made in Nepal by a Nepalese firm, then

Accepted Answer

A)  U.S. consumption increases, U.S. net exports decrease, and U.S. GDP decreases. 
B)  U.S. consumption increases, U.S. net exports decrease, and U.S. GDP is unaffected. 
C)  U.S. consumption decreases, U.S. net exports increase, and U.S. GDP increases. 
D)  U.S. consumption decreases, U.S. net exports increase, and U.S. GDP is unaffected. 
A)  U.S. consumption increases, U.S. net exports decrease, and U.S. GDP decreases. 
B)  U.S. consumption increases, U.S. net exports decrease, and U.S. GDP is unaffected. 
C)  U.S. consumption decreases, U.S. net exports increase, and U.S. GDP increases. 
D)  U.S. consumption decreases, U.S. net exports increase, and U.S. GDP is unaffected.

Question 7

A good is produced by a firm in 2009, added to the firm's inventory in 2010, and sold to a household in 2010. As a result, on net,

Accepted Answer

A)  2009 GDP increased and 2010 GDP decreased. 
B)  2009 GDP decreased and 2010 GDP increased. 
C)  2009 GDP did not change and 2010 GDP increased. 
D)  2009 GDP increased and 2010 GDP did not change. 
A)  2009 GDP increased and 2010 GDP decreased. 
B)  2009 GDP decreased and 2010 GDP increased. 
C)  2009 GDP did not change and 2010 GDP increased. 
D)  2009 GDP increased and 2010 GDP did not change.

Question 8

The residents of Ireland earn $200 million of income from abroad. Residents of other countries earn $300 million in Ireland. Therefore, Ireland's

Accepted Answer

A)  net factor payments from abroad are positive, and its GDP is larger than its GNP. 
B)  net factor payments from abroad are positive, and its GNP is larger than its GDP. 
C)  net factor payments from abroad are negative, and its GDP is larger than its GNP. 
D)  net factor payments from abroad are negative, and its GNP is larger than its GDP. 
A)  net factor payments from abroad are positive, and its GDP is larger than its GNP. 
B)  net factor payments from abroad are positive, and its GNP is larger than its GDP. 
C)  net factor payments from abroad are negative, and its GDP is larger than its GNP. 
D)  net factor payments from abroad are negative, and its GNP is larger than its GDP.

Question 9

If a good produced this quarter goes into inventory, then it is included in this period's GDP. If it is sold in the next quarter, it will have no effect on GDP.

Accepted Answer

A) True 
 B)False

Question 10

A stove is produced by a firm in 2014, added to the firm's inventory in 2014, and sold to a household in 2015. It follows that

Accepted Answer

A)  the value of the good is added to the investment category of 2014 GDP, added to the consumption category of 2015 GDP, and subtracted from the investment category of 2015 GDP. 
B)  the value of the good is added to the investment category of 2014 GDP, added to the consumption category of 2015 GDP, and not included in the investment category of 2015 GDP. 
C)  the value of the good is added to the investment category of 2014 GDP, subtracted from the consumption category of 2015 GDP, and not included in the investment category of 2015 GDP. 
D)  the value of the good is added to the investment category of 2014 GDP, subtracted from the consumption category of 2015 GDP, and added to the investment category of 2015 GDP. 
A)  the value of the good is added to the investment category of 2014 GDP, added to the consumption category of 2015 GDP, and subtracted from the investment category of 2015 GDP. 
B)  the value of the good is added to the investment category of 2014 GDP, added to the consumption category of 2015 GDP, and not included in the investment category of 2015 GDP. 
C)  the value of the good is added to the investment category of 2014 GDP, subtracted from the consumption category of 2015 GDP, and not included in the investment category of 2015 GDP. 
D)  the value of the good is added to the investment category of 2014 GDP, subtracted from the consumption category of 2015 GDP, and added to the investment category of 2015 GDP.

Question 11

Table 23-4
The table below reports nominal and real GDP for the U.S. from 1929 to 1932.
  
-Refer to Table 23-4. What are the GDP deflator and the inflation rate for 1931?

Accepted Answer

A)  9.16, -11.5 
B)  9.16, -10.3 
C)  1091.37, 10.3 
D)  1091.37, 11.5 
A)  9.16, -11.5 
B)  9.16, -10.3 
C)  1091.37, 10.3 
D)  1091.37, 11.5

Question 12

Which of the following always uses prices and quantities from the same period?

Accepted Answer

A)  both nominal and real GDP. 
B)  nominal GDP but not real GDP. 
C)  real GDP but not nominal GDP. 
D)  neither nominal or real GDP. 
A)  both nominal and real GDP. 
B)  nominal GDP but not real GDP. 
C)  real GDP but not nominal GDP. 
D)  neither nominal or real GDP.

Question 13

Table 23-1
The table below contains data for Chereaux for the year 2015.
  
-Refer to Table 23-1. The market value of all final goods and services produced within Chereaux in 2015 is

Accepted Answer

A)  $214. 
B)  $200. 
C)  $204. 
D)  $230. 
A)  $214. 
B)  $200. 
C)  $204. 
D)  $230.

Question 14

In the economy of Talikastan in 2015, consumption was $3000, GDP was $5500, government purchases were $1000, imports were $1000, and investment was $1000. What were Talikastan's exports in 2015?

Accepted Answer

A) -$500 
B)  $500 
C)  $1500 
D)  $-1500 
A) -$500 
B)  $500 
C)  $1500 
D)  $-1500

Question 15

In the base year, the GDP deflator is always

Accepted Answer

A)  -1. 
B)  0. 
C)  1. 
D)  100. 
A)  -1. 
B)  0. 
C)  1. 
D)  100.

Question 16

GDP is a good measure of economic well-being for all purposes.

Accepted Answer

A) True 
 B)False

Question 17

If you buy a burger and fries at your favorite fast food restaurant,

Accepted Answer

A)  then neither GDP nor consumption will be affected because you would have eaten at home had you not bought the meal at the restaurant. 
B)  then GDP will be higher, but consumption spending will be unchanged. 
C)  then GDP will be unchanged, but consumption spending will be higher. 
D)  then both GDP and consumption spending will be higher. 
A)  then neither GDP nor consumption will be affected because you would have eaten at home had you not bought the meal at the restaurant. 
B)  then GDP will be higher, but consumption spending will be unchanged. 
C)  then GDP will be unchanged, but consumption spending will be higher. 
D)  then both GDP and consumption spending will be higher.

Question 18

In a simple circular-flow diagram, total income and total expenditure are

Accepted Answer

A)  never equal because total income always exceeds total expenditure. 
B)  seldom equal because of the ongoing changes in an economy's unemployment rate. 
C)  equal only when the government purchases no goods or services. 
D)  always equal because every transaction has a buyer and a seller. 
A)  never equal because total income always exceeds total expenditure. 
B)  seldom equal because of the ongoing changes in an economy's unemployment rate. 
C)  equal only when the government purchases no goods or services. 
D)  always equal because every transaction has a buyer and a seller.

Question 19

Table 23-12
A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year.
  
-Refer to Table 23-12. Calculate the GDP deflator for 2012 and 2013.

Accepted Answer

GDP deflator is 127.

Question 20

Social Security payments are

Accepted Answer

A)  included in GDP because they represent current income. 
B)  included in GDP because they represent potential consumption. 
C)  excluded from GDP because they are not private pensions. 
D)  excluded from GDP because they do not reflect the economy's production. 
A)  included in GDP because they represent current income. 
B)  included in GDP because they represent potential consumption. 
C)  excluded from GDP because they are not private pensions. 
D)  excluded from GDP because they do not reflect the economy's production.

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

In the economy of Talikastan in 2015, consumption was $600, exports were $300, GDP was $1300, government purchases were $250, and investment was $300. What were Talikastan's imports in 2015?

In a simple circular-flow diagram, firms use the money they get from a sale to

Which of the following items is included in U.S. GDP?

Which of the following is an example of a durable good?

If a U.S. citizen buys a dress made in Nepal by a Nepalese firm, then

A good is produced by a firm in 2009, added to the firm's inventory in 2010, and sold to a household in 2010. As a result, on net,

The residents of Ireland earn $200 million of income from abroad. Residents of other countries earn $300 million in Ireland. Therefore, Ireland's

If a good produced this quarter goes into inventory, then it is included in this period's GDP. If it is sold in the next quarter, it will have no effect on GDP.

A stove is produced by a firm in 2014, added to the firm's inventory in 2014, and sold to a household in 2015. It follows that

Table 23-4 The table below reports nominal and real GDP for the U.S. from 1929 to 1932. -Refer to Table 23-4. What are the GDP deflator and the inflation rate for 1931?

Which of the following always uses prices and quantities from the same period?

Table 23-1 The table below contains data for Chereaux for the year 2015. -Refer to Table 23-1. The market value of all final goods and services produced within Chereaux in 2015 is

In the economy of Talikastan in 2015, consumption was $3000, GDP was $5500, government purchases were $1000, imports were $1000, and investment was $1000. What were Talikastan's exports in 2015?

In the base year, the GDP deflator is always

GDP is a good measure of economic well-being for all purposes.

If you buy a burger and fries at your favorite fast food restaurant,

In a simple circular-flow diagram, total income and total expenditure are

Table 23-12 A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year. -Refer to Table 23-12. Calculate the GDP deflator for 2012 and 2013.

Social Security payments are

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 and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

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 Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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Exam 5: Measuring a Nations Income

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

In the economy of Talikastan in 2015, consumption was $600, exports were $300, GDP was $1300, government purchases were $250, and investment was $300. What were Talikastan's imports in 2015?

In a simple circular-flow diagram, firms use the money they get from a sale to

Which of the following items is included in U.S. GDP?

Which of the following is an example of a durable good?

If a U.S. citizen buys a dress made in Nepal by a Nepalese firm, then

A good is produced by a firm in 2009, added to the firm's inventory in 2010, and sold to a household in 2010. As a result, on net,

The residents of Ireland earn $200 million of income from abroad. Residents of other countries earn $300 million in Ireland. Therefore, Ireland's

If a good produced this quarter goes into inventory, then it is included in this period's GDP. If it is sold in the next quarter, it will have no effect on GDP.

A stove is produced by a firm in 2014, added to the firm's inventory in 2014, and sold to a household in 2015. It follows that

Table 23-4 The table below reports nominal and real GDP for the U.S. from 1929 to 1932. -Refer to Table 23-4. What are the GDP deflator and the inflation rate for 1931?

Which of the following always uses prices and quantities from the same period?

Table 23-1 The table below contains data for Chereaux for the year 2015. -Refer to Table 23-1. The market value of all final goods and services produced within Chereaux in 2015 is

In the economy of Talikastan in 2015, consumption was $3000, GDP was $5500, government purchases were $1000, imports were $1000, and investment was $1000. What were Talikastan's exports in 2015?

In the base year, the GDP deflator is always

GDP is a good measure of economic well-being for all purposes.

If you buy a burger and fries at your favorite fast food restaurant,

In a simple circular-flow diagram, total income and total expenditure are

Table 23-12 A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year. -Refer to Table 23-12. Calculate the GDP deflator for 2012 and 2013.

Social Security payments are

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 and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

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 Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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