Question 1

All of the following are examples of a nondurable good except

Accepted Answer

A)  a pencil. 
B)  one gallon of gasoline. 
C)  a queen-size bed. 
D)  a pair of shoes. 
A)  a pencil. 
B)  one gallon of gasoline. 
C)  a queen-size bed. 
D)  a pair of shoes.

Question 2

If in some year nominal GDP was $10 trillion and real GDP was $4 trillion, what was the GDP deflator?

Accepted Answer

A)  25. 
B)  40. 
C)  250. 
D)  400. 
A)  25. 
B)  40. 
C)  250. 
D)  400.

Question 3

In the economy of Talikastan in 2015, consumption was $700, exports were $200, government purchases were $300, imports were $150, and investment was $400. What was Talikastan's GDP in 2015?

Accepted Answer

A)  $1350 
B)  $1450 
C)  $1050 
D)  $1750 
A)  $1350 
B)  $1450 
C)  $1050 
D)  $1750

Question 4

Are sales of used goods included in GDP? Explain why or why not. Hint: Remember how GDP is defined.

Accepted Answer

Sales of used goods

Question 5

The consumption component of GDP includes spending on

Accepted Answer

A)  durable goods and nondurable goods, but not spending on services. 
B)  durable goods and services, but not spending on nondurable goods. 
C)  nondurable goods and services, but not spending on durable goods. 
D)  durable goods, nondurable goods, and services. 
A)  durable goods and nondurable goods, but not spending on services. 
B)  durable goods and services, but not spending on nondurable goods. 
C)  nondurable goods and services, but not spending on durable goods. 
D)  durable goods, nondurable goods, and services.

Question 6

Al's Aluminum Company sells $1 million worth of aluminum to Shiny Foil Company, which uses the aluminum to make aluminum foil. Shiny Foil Company sells $4 million worth of aluminum foil to households. The transactions just described contribute how much to GDP?

Accepted Answer

A)  $1 million 
B)  $3 million 
C)  $4 million 
D)  $5 million 
A)  $1 million 
B)  $3 million 
C)  $4 million 
D)  $5 million

Question 7

In the economy of Talikastan in 2015, consumption was $6000, exports were $1000, GDP was $10,000, government purchases were $1800, and imports were $1200. What was Talikastan's investment in 2015?

Accepted Answer

A)  $0 
B)  $1200 
C)  $2400 
D)  $5600 
A)  $0 
B)  $1200 
C)  $2400 
D)  $5600

Question 8

Which of the following topics are more likely to be studied by a macroeconomist than by a microeconomist?

Accepted Answer

A)  the effect of taxes on the prices of airline tickets, and the profitability of automobile-manufacturing firms 
B)  the price of beef, and wage differences between genders 
C)  how consumers maximize utility, and how prices are established in markets for agricultural products 
D)  the percentage of the labor force that is out of work, and differences in average income from country to country 
A)  the effect of taxes on the prices of airline tickets, and the profitability of automobile-manufacturing firms 
B)  the price of beef, and wage differences between genders 
C)  how consumers maximize utility, and how prices are established in markets for agricultural products 
D)  the percentage of the labor force that is out of work, and differences in average income from country to country

Question 9

Table 23-10
A hypothetical country of Lahland produces only movies and popcorn. Quantities and prices of these goods for the last several years are shown below. The base year is 2015 .
  
-Refer to Table 23-10. What was this country's nominal GDP in 2014?

Accepted Answer

A)  $9,500 
B)  $10,000 
C)  $10,200 
D)  $10,500 
A)  $9,500 
B)  $10,000 
C)  $10,200 
D)  $10,500

Question 10

What are exports, and how are they different from imports?

Accepted Answer

Exports are domestically produ

Question 11

The term economists use to describe a situation in which the economy's overall price level is rising is

Accepted Answer

A)  growth. 
B)  inflation. 
C)  recession. 
D)  expansion. 
A)  growth. 
B)  inflation. 
C)  recession. 
D)  expansion.

Question 12

Figure 23-2.  
-Refer to Figure 23-2. Identify the location of firms and households.

Accepted Answer

W is firms

Question 13

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 14

The inflation rate in year 2 equals

Accepted Answer

A)   
B)   
C)   
D)   
A)   
B)   
C)   
D)

Question 15

If net exports is a negative number for a particular year, then

Accepted Answer

A)  the value of firms' inventories declined over the course of the year. 
B)  consumption exceeded the sum of investment and government purchases during the year. 
C)  the value of goods sold to foreigners exceeded the value of foreign goods purchased during the year. 
D)  the value of foreign goods purchased exceeded the value of goods sold to foreigners during the year. 
A)  the value of firms' inventories declined over the course of the year. 
B)  consumption exceeded the sum of investment and government purchases during the year. 
C)  the value of goods sold to foreigners exceeded the value of foreign goods purchased during the year. 
D)  the value of foreign goods purchased exceeded the value of goods sold to foreigners during the year.

Question 16

A farmer sells five pounds of pecans to a Smith's Fresh Pecans for $10. Smith's Fresh Pecans resells three pounds for $4.50 per pound. The remaining pecans are shelled and canned and sold for a total of $8.00 Taking these transactions into account, how much is added to GDP?

Accepted Answer

A)  $22.50 
B)  $29.50 
C)  $21.50 
D)  $31.50 
A)  $22.50 
B)  $29.50 
C)  $21.50 
D)  $31.50

Question 17

Most goods and services produced at home

Accepted Answer

A)  and most goods and services produced illegally are included in GDP. 
B)  are included in GDP while most goods and services produced illegally are excluded from GDP. 
C)  are excluded from GDP while most goods and services produced illegally are included in GDP 
D)  and most goods and services produced illegally are excluded from GDP. 
A)  and most goods and services produced illegally are included in GDP. 
B)  are included in GDP while most goods and services produced illegally are excluded from GDP. 
C)  are excluded from GDP while most goods and services produced illegally are included in GDP 
D)  and most goods and services produced illegally are excluded from GDP.

Question 18

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 19

In the United States in 2012, consumption represented approximately

Accepted Answer

A)  60 percent of GDP. 
B)  70 percent of GDP. 
C)  80 percent of GDP. 
D)  90 percent of GDP. 
A)  60 percent of GDP. 
B)  70 percent of GDP. 
C)  80 percent of GDP. 
D)  90 percent of GDP.

Question 20

A country reported a nominal GDP of $85 billion in 2010 and $100 billion in 2009. It also reported a GDP deflator of 100 in 2010 and 105 in 2009. Between 2009 and 2010,

Accepted Answer

A)  real output and the price level both rose. 
B)  real output rose and the price level fell. 
C)  real output fell and the price level rose. 
D)  real output and the price level both fell. 
A)  real output and the price level both rose. 
B)  real output rose and the price level fell. 
C)  real output fell and the price level rose. 
D)  real output and the price level both fell.

Exam 15: Measuring a Nations Income

All of the following are examples of a nondurable good except

If in some year nominal GDP was $10 trillion and real GDP was $4 trillion, what was the GDP deflator?

In the economy of Talikastan in 2015, consumption was $700, exports were $200, government purchases were $300, imports were $150, and investment was $400. What was Talikastan's GDP in 2015?

Are sales of used goods included in GDP? Explain why or why not. Hint: Remember how GDP is defined.

The consumption component of GDP includes spending on

Al's Aluminum Company sells $1 million worth of aluminum to Shiny Foil Company, which uses the aluminum to make aluminum foil. Shiny Foil Company sells $4 million worth of aluminum foil to households. The transactions just described contribute how much to GDP?

In the economy of Talikastan in 2015, consumption was $6000, exports were $1000, GDP was $10,000, government purchases were $1800, and imports were $1200. What was Talikastan's investment in 2015?

Which of the following topics are more likely to be studied by a macroeconomist than by a microeconomist?

Table 23-10 A hypothetical country of Lahland produces only movies and popcorn. Quantities and prices of these goods for the last several years are shown below. The base year is 2015 . -Refer to Table 23-10. What was this country's nominal GDP in 2014?

What are exports, and how are they different from imports?

The term economists use to describe a situation in which the economy's overall price level is rising is

Figure 23-2. -Refer to Figure 23-2. Identify the location of firms and households.

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?

The inflation rate in year 2 equals

If net exports is a negative number for a particular year, then

A farmer sells five pounds of pecans to a Smith's Fresh Pecans for $10. Smith's Fresh Pecans resells three pounds for $4.50 per pound. The remaining pecans are shelled and canned and sold for a total of $8.00 Taking these transactions into account, how much is added to GDP?

Most goods and services produced at home

In the United States in 2012, consumption represented approximately

A country reported a nominal GDP of $85 billion in 2010 and $100 billion in 2009. It also reported a GDP deflator of 100 in 2010 and 105 in 2009. Between 2009 and 2010,

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Costs of Production

Firms in Competitive Markets

Monopoly

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

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

Filters