Question 1

The GDP of the U.S.in 2012 was around $15.9 trillion.This means

Accepted Answer

A) that the value of output in the U.S.in 2012 was around $15.9 trillion. 
B) that total income in the U.S.in 2012 was around $15.9 trillion. 
C) that total spending on final goods and services in the U.S.in 2012 was around $15.9 trillion. 
D) all of the above 
A) that the value of output in the U.S.in 2012 was around $15.9 trillion. 
B) that total income in the U.S.in 2012 was around $15.9 trillion. 
C) that total spending on final goods and services in the U.S.in 2012 was around $15.9 trillion. 
D) all of the above

Question 2

Stock market transactions are part of GNP.

Accepted Answer

A) True 
 B)False

Question 3

The change in capital stock in a period is equal to

Accepted Answer

A) the ratio of the amount of the capital at the beginning of the period to the amount of depreciation. 
B) the amount of the capital stock at the beginning of the period plus gross investment minus depreciation. 
C) the amount of the capital at the beginning of the period plus gross investment. 
D) the amount of the capital at the beginning of the period minus net investment. 
A) the ratio of the amount of the capital at the beginning of the period to the amount of depreciation. 
B) the amount of the capital stock at the beginning of the period plus gross investment minus depreciation. 
C) the amount of the capital at the beginning of the period plus gross investment. 
D) the amount of the capital at the beginning of the period minus net investment.

Question 4

Net national product is

Accepted Answer

A) GDP plus depreciation. 
B) GDP minus depreciation. 
C) GNP minus depreciation. 
D) GNP plus depreciation. 
A) GDP plus depreciation. 
B) GDP minus depreciation. 
C) GNP minus depreciation. 
D) GNP plus depreciation.

Question 5

New houses count as consumer durables.

Accepted Answer

A) True 
 B)False

Question 6

Final sales plus changes in inventories equals GDP.

Accepted Answer

A) True 
 B)False

Question 7

Related to the Economics in Practice on p.427: The value of the used goods sold on eBay from a U.S.seller to a U.S.buyer is

Accepted Answer

A) counted in U.S.GDP but not GNP. 
B) counted in U.S.GNP but not GDP. 
C) counted in both U.S.GDP and GNP. 
D) not counted in either U.S.GDP or GNP. 
A) counted in U.S.GDP but not GNP. 
B) counted in U.S.GNP but not GDP. 
C) counted in both U.S.GDP and GNP. 
D) not counted in either U.S.GDP or GNP.

Question 8

Which of the following is included in both the U.S.GDP and GNP?

Accepted Answer

A) The value of all cars produced by Ford in Mexico. 
B) The value of all cars produced by General Motors in the U.S. 
C) The value of all cars produced by Toyota in the U.S. 
D) The value of cars produced by Nissan in Japan and the U.S. 
A) The value of all cars produced by Ford in Mexico. 
B) The value of all cars produced by General Motors in the U.S. 
C) The value of all cars produced by Toyota in the U.S. 
D) The value of cars produced by Nissan in Japan and the U.S.

Question 9

Gross domestic product measured in terms of the prices of a fixed,or base,year is

Accepted Answer

A) current GDP. 
B) base GDP. 
C) real GDP. 
D) nominal GDP. 
A) current GDP. 
B) base GDP. 
C) real GDP. 
D) nominal GDP.

Question 10

Refer to the information provided in Table 6.2 below to answer the questions that follow.
Table 6.2  
-Refer to Table 6.2.The value for net exports in billions of dollars is

Accepted Answer

A) -200. 
B) -150. 
C) 50. 
D) 250. 
A) -200. 
B) -150. 
C) 50. 
D) 250.

Question 11

Transfer payments are subtracted from national income to get to personal income.

Accepted Answer

A) True 
 B)False

Question 12

Legalizing all forms of illegal activities would

Accepted Answer

A) reduce measured GDP. 
B) reduce the size of the underground economy and increase measured GDP. 
C) reduce both the underground economy and measured GDP. 
D) increase the size of the underground economy and reduce measured GDP. 
A) reduce measured GDP. 
B) reduce the size of the underground economy and increase measured GDP. 
C) reduce both the underground economy and measured GDP. 
D) increase the size of the underground economy and reduce measured GDP.

Question 13

If investment is larger than depreciation,the capital stock decreases.

Accepted Answer

A) True 
 B)False

Question 14

A farmer buys a new tractor from John Deere to use on her cotton farm.This tractor is included in GDP as

Accepted Answer

A) part of gross private domestic investment. 
B) a durable consumption good. 
C) a service. 
D) a nondurable consumption good. 
A) part of gross private domestic investment. 
B) a durable consumption good. 
C) a service. 
D) a nondurable consumption good.

Question 15

If nominal GDP rises,then so must real GDP.

Accepted Answer

A) True 
 B)False

Question 16

Depreciation is included in GDP,but excluded from NNP.

Accepted Answer

A) True 
 B)False

Question 17

Income Mexican citizens earn in the U.S.counts in

Accepted Answer

A) U.S.GNP. 
B) Mexican GNP. 
C) Mexican GDP. 
D) both U.S.and Mexican GDP. 
A) U.S.GNP. 
B) Mexican GNP. 
C) Mexican GDP. 
D) both U.S.and Mexican GDP.

Question 18

If net investment in 2013 is $500 billion and gross investment in 2013 is $900 billion,depreciation in 2013 is

Accepted Answer

A) -$500 billion. 
B) $0. 
C) $400 billion. 
D) $1,400 billion. 
A) -$500 billion. 
B) $0. 
C) $400 billion. 
D) $1,400 billion.

Question 19

Net interest is the interest on loans paid by

Accepted Answer

A) businesses,households,and the government. 
B) businesses and households. 
C) businesses and the government. 
D) businesses. 
A) businesses,households,and the government. 
B) businesses and households. 
C) businesses and the government. 
D) businesses.

Question 20

Related to the Economics in Practice on p.436: If the effects of pollution on society as a measure of welfare were included in GDP calculations,the measured level of GDP would most likely

Accepted Answer

A) increase. 
B) decrease. 
C) not change. 
D) become negative. 
A) increase. 
B) decrease. 
C) not change. 
D) become negative.

Exam 6: Measuring National Output and National Income

The GDP of the U.S.in 2012 was around $15.9 trillion.This means

Stock market transactions are part of GNP.

The change in capital stock in a period is equal to

Net national product is

New houses count as consumer durables.

Final sales plus changes in inventories equals GDP.

Related to the Economics in Practice on p.427: The value of the used goods sold on eBay from a U.S.seller to a U.S.buyer is

Which of the following is included in both the U.S.GDP and GNP?

Gross domestic product measured in terms of the prices of a fixed,or base,year is

Refer to the information provided in Table 6.2 below to answer the questions that follow. Table 6.2 -Refer to Table 6.2.The value for net exports in billions of dollars is

Transfer payments are subtracted from national income to get to personal income.

Legalizing all forms of illegal activities would

If investment is larger than depreciation,the capital stock decreases.

A farmer buys a new tractor from John Deere to use on her cotton farm.This tractor is included in GDP as

If nominal GDP rises,then so must real GDP.

Depreciation is included in GDP,but excluded from NNP.

Income Mexican citizens earn in the U.S.counts in

If net investment in 2013 is $500 billion and gross investment in 2013 is $900 billion,depreciation in 2013 is

Net interest is the interest on loans paid by

Related to the Economics in Practice on p.436: If the effects of pollution on society as a measure of welfare were included in GDP calculations,the measured level of GDP would most likely

The Scope and Method of Economics

The Economic Problem: Scarcity and Choice

Demand,supply,and Market Equilibrium

Demand and Supply Applications

Introduction to Macroeconomics

Unemployment, inflation, and Long-Run Growth

Aggregate Expenditure and Equilibrium Output

The Government and Fiscal Policy

The Money Supply and the Federal Reserve System

Money Demand and the Equilibrium Interest Rate

The Determination of Aggregate Output, the Price Level, and the Interest Rate

Policy Effects and Costs Shocks in the Asad Model

The Labor Market in the Macroeconomy

Financial Crises, stabilization, and Deficits

Household and Firm Behavior in the Macroeconomy: a Further Look

Long-Run Growth

Alternative Views in Macroeconomics

International Trade,comparative Advantage,and Protectionism

Open-Economy Macroeconomics: the Balance of Payments and Exchange Rates

Economic Growth in Developing and Transitional Economies

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