Question 1

The equation for GDP using the expenditure approach is

Accepted Answer

A) GDP = C + I + G + EX - IM. 
B) GDP = C + I + G + (IM - EX). 
C) GDP = C + I + G + EX + IM. 
D) GDP = C + I + G - EX - IM. 
A) GDP = C + I + G + EX - IM. 
B) GDP = C + I + G + (IM - EX). 
C) GDP = C + I + G + EX + IM. 
D) GDP = C + I + G - EX - IM.

Question 2

The total market value of all final goods and services produced within a given period by factors of production located within a country is

Accepted Answer

A) gross domestic product. 
B) gross national product. 
C) net national product. 
D) net national income. 
A) gross domestic product. 
B) gross national product. 
C) net national product. 
D) net national income.

Question 3

The GDP deflator in year 2 is 110 using year 1 as a base year.This means that,on average,the price of goods and services is

Accepted Answer

A) 110% higher in year 2 than in year 1. 
B) 10% higher in year 2 than in year 1. 
C) 5% higher in year 1 than in year 2. 
D) 110% higher in year 1 than in year 2. 
A) 110% higher in year 2 than in year 1. 
B) 10% higher in year 2 than in year 1. 
C) 5% higher in year 1 than in year 2. 
D) 110% higher in year 1 than in year 2.

Question 4

If depreciation equals zero and retained earnings equal $5 billion,then

Accepted Answer

A) GNP is less than net national product by $5 billion. 
B) GNP equals net national product. 
C) Net national product is less than GNP by $5 billion. 
D) GNP is greater than GDP by $5 billion. 
A) GNP is less than net national product by $5 billion. 
B) GNP equals net national product. 
C) Net national product is less than GNP by $5 billion. 
D) GNP is greater than GDP by $5 billion.

Question 5

Fixed weight indexes can not account for new goods.

Accepted Answer

A) True 
 B)False

Question 6

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 of government spending in billions of dollars is

Accepted Answer

A) 200. 
B) 600. 
C) 800. 
D) 1,000. 
A) 200. 
B) 600. 
C) 800. 
D) 1,000.

Question 7

The value of what KFC produces in Japan is included in the U.S.________ and in the Japanese ________.

Accepted Answer

A) GDP;GDP 
B) GNP;GNP 
C) GNP;GDP 
D) GDP;GNP 
A) GDP;GDP 
B) GNP;GNP 
C) GNP;GDP 
D) GDP;GNP

Question 8

Refer to the information provided in Table 6.1 below to answer the questions that follow.
Table 6.1  
-Refer to Table 6.1.The value of government spending in billions of dollars is

Accepted Answer

A) 100. 
B) 200. 
C) 300. 
D) 500. 
A) 100. 
B) 200. 
C) 300. 
D) 500.

Question 9

Saving rates tend to ________ during boom times and ________ during recession periods.

Accepted Answer

A) rise;rise 
B) rise;fall 
C) fall;rise 
D) fall;fall 
A) rise;rise 
B) rise;fall 
C) fall;rise 
D) fall;fall

Question 10

If GNP is $200 billion and depreciation is $20 billion,then net national product is

Accepted Answer

A) $100 billion. 
B) $180 billion. 
C) $210 billion. 
D) $220 billion. 
A) $100 billion. 
B) $180 billion. 
C) $210 billion. 
D) $220 billion.

Question 11

The GDP deflator in year 2 is 110 and the GDP deflator in year 3 is 118.The rate of inflation between years 2 and 3 is

Accepted Answer

A) 4.55%. 
B) 7.27%. 
C) 8%. 
D) 18%. 
A) 4.55%. 
B) 7.27%. 
C) 8%. 
D) 18%.

Question 12

The income of U.S.citizens working abroad counts in U.S.GDP.

Accepted Answer

A) True 
 B)False

Question 13

Related to the Economics in Practice on p.431: ________ is responsible for producing and maintaining the National Income and Product Accounts (NIPAs).

Accepted Answer

A) The Department of the Treasury 
B) The Federal Reserve Bank 
C) Congress 
D) The Department of Commerce 
A) The Department of the Treasury 
B) The Federal Reserve Bank 
C) Congress 
D) The Department of Commerce

Question 14

GDP is not a perfect measure of social welfare and the society's economic well-being because

Accepted Answer

A) it does not say anything about the distribution of income. 
B) GDP accounting rules do not adjust for production that causes negative externalities. 
C) it does not include all economic activities in the economy. 
D) all of the above 
A) it does not say anything about the distribution of income. 
B) GDP accounting rules do not adjust for production that causes negative externalities. 
C) it does not include all economic activities in the economy. 
D) all of the above

Question 15

Related to the Economics in Practice on p.431: The National Income and Product Accounts (NIPAs)allow policymakers and economists to analyze the impact of

Accepted Answer

A) spending and tax plans. 
B) price shocks. 
C) monetary policy. 
D) all of the above 
A) spending and tax plans. 
B) price shocks. 
C) monetary policy. 
D) all of the above

Question 16

Refer to the information provided in Table 6.3 below to answer the questions that follow.
Table 6.3  
-Refer to Table 6.3.The value of disposable income

Accepted Answer

A) is 505. 
B) is 560. 
C) is 605. 
D) cannot be calculated given the information in Table 6.3. 
A) is 505. 
B) is 560. 
C) is 605. 
D) cannot be calculated given the information in Table 6.3.

Question 17

Refer to the information provided in Table 6.4 below to answer the questions that follow.
Table 6.4  
-Refer to Table 6.4.The value for national income in billions of dollars is

Accepted Answer

A) 890. 
B) 910. 
C) 940. 
D) 970. 
A) 890. 
B) 910. 
C) 940. 
D) 970.

Question 18

Depreciation is

Accepted Answer

A) subtracted from national income to get GDP. 
B) added to national income to get GDP. 
C) subtracted from GNP to get NNP. 
D) added to GNP to get NNP. 
A) subtracted from national income to get GDP. 
B) added to national income to get GDP. 
C) subtracted from GNP to get NNP. 
D) added to GNP to get NNP.

Question 19

The total income of households is

Accepted Answer

A) net national product. 
B) personal income. 
C) national income. 
D) production income. 
A) net national product. 
B) personal income. 
C) national income. 
D) production income.

Question 20

GDP measured in base year prices is real GDP.

Accepted Answer

A) True 
 B)False

Exam 6: Measuring National Output and National Income

The equation for GDP using the expenditure approach is

The total market value of all final goods and services produced within a given period by factors of production located within a country is

The GDP deflator in year 2 is 110 using year 1 as a base year.This means that,on average,the price of goods and services is

If depreciation equals zero and retained earnings equal $5 billion,then

Fixed weight indexes can not account for new goods.

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 of government spending in billions of dollars is

The value of what KFC produces in Japan is included in the U.S.________ and in the Japanese ________.

Refer to the information provided in Table 6.1 below to answer the questions that follow. Table 6.1 -Refer to Table 6.1.The value of government spending in billions of dollars is

Saving rates tend to ________ during boom times and ________ during recession periods.

If GNP is $200 billion and depreciation is $20 billion,then net national product is

The GDP deflator in year 2 is 110 and the GDP deflator in year 3 is 118.The rate of inflation between years 2 and 3 is

The income of U.S.citizens working abroad counts in U.S.GDP.

Related to the Economics in Practice on p.431: ________ is responsible for producing and maintaining the National Income and Product Accounts (NIPAs).

GDP is not a perfect measure of social welfare and the society's economic well-being because

Related to the Economics in Practice on p.431: The National Income and Product Accounts (NIPAs)allow policymakers and economists to analyze the impact of

Refer to the information provided in Table 6.3 below to answer the questions that follow. Table 6.3 -Refer to Table 6.3.The value of disposable income

Refer to the information provided in Table 6.4 below to answer the questions that follow. Table 6.4 -Refer to Table 6.4.The value for national income in billions of dollars is

Depreciation is

The total income of households is

GDP measured in base year prices is real GDP.

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

Filters

The value of what KFC produces in Japan is included in the U.S. and in the Japanese .

Saving rates tend to during boom times and during recession periods.