Question 1

In the circular flow diagram,________ supply the factors of production,and ________ goods and services.

Accepted Answer

A) households;sell 
B) households;buy 
C) firms;sell 
D) firms;buy 
A) households;sell 
B) households;buy 
C) firms;sell 
D) firms;buy

Question 2

Table 8-17
   A very simple economy produces three goods: movies,burgers,and bikes.The quantities produced and their corresponding prices for 2011 and 2016 are shown in the table above.
-Refer to Table 8-17.What is nominal GDP in 2011?

Accepted Answer

A) $3,320 
B) $3,690 
C) $6,360 
D) $7,035 
A) $3,320 
B) $3,690 
C) $6,360 
D) $7,035

Question 3

An example of an intermediate good would be

Accepted Answer

A) a new car. 
B) a used car. 
C) the rims on a new car. 
D) new rims to replace old rims on a used car. 
A) a new car. 
B) a used car. 
C) the rims on a new car. 
D) new rims to replace old rims on a used car.

Question 4

The U.S.work week has declined from 60 hours in 1890 to 40 hours today.The impact of the decline in working hours

Accepted Answer

A) increases U.S.GDP and increases the well-being of a typical working person in the U.S. 
B) increases U.S.GDP and decreases the well-being of a typical working person in the U.S. 
C) decreases U.S.GDP and increases the well-being of a typical working person in the U.S. 
D) decreases U.S.GDP and decreases the well-being of a typical working person in the U.S. 
A) increases U.S.GDP and increases the well-being of a typical working person in the U.S. 
B) increases U.S.GDP and decreases the well-being of a typical working person in the U.S. 
C) decreases U.S.GDP and increases the well-being of a typical working person in the U.S. 
D) decreases U.S.GDP and decreases the well-being of a typical working person in the U.S.

Question 5

The purchase by a household in China of a CD produced in the United States is included in U.S.

Accepted Answer

A) consumption expenditures. 
B) investment expenditures. 
C) government purchases. 
D) net exports. 
A) consumption expenditures. 
B) investment expenditures. 
C) government purchases. 
D) net exports.

Question 6

Over the last 50 years,has the ratio of household production to gross domestic product in the United States increased or decreased? Consider the effect of the increased number of women working outside the home,and the effect of advances in technology in household production such as microwaves,coffee makers,power tools,etc.

Accepted Answer

"Household production" refers to goods a

Question 7

In the circular flow model,the value of total income for an economy ________ the value of total production.

Accepted Answer

A) equals 
B) is greater than 
C) is less than 
D) may be greater than or less than 
A) equals 
B) is greater than 
C) is less than 
D) may be greater than or less than

Question 8

Government spending ________ is included in gross domestic product.

Accepted Answer

A) at federal,state,and local levels of government 
B) at the federal level of government only 
C) at state and local levels of government only 
D) on defense goods only 
A) at federal,state,and local levels of government 
B) at the federal level of government only 
C) at state and local levels of government only 
D) on defense goods only

Question 9

Table 8-11
   Consider the following data for Tyrovia,a country that produces only two products: guns and butter.
-Refer to Table 8-11.Nominal GDP for Tyrovia in 2016 equals

Accepted Answer

A) $1,140. 
B) $880. 
C) $690. 
D) $560. 
A) $1,140. 
B) $880. 
C) $690. 
D) $560.

Question 10

The circular flow diagram shows that

Accepted Answer

A) the value of total income is equal to the total value of expenditures on final goods and services. 
B) firms pay households wages,and households receive transfer payments from firms. 
C) households spend all their income on goods and services. 
D) GDP will be less than the total value of expenditures on final goods and services in the economy. 
A) the value of total income is equal to the total value of expenditures on final goods and services. 
B) firms pay households wages,and households receive transfer payments from firms. 
C) households spend all their income on goods and services. 
D) GDP will be less than the total value of expenditures on final goods and services in the economy.

Question 11

A car that is produced in 2016 is not sold until 2017.According to the definition of GDP,in which year's GDP should it be counted?

Accepted Answer

A) 2016 
B) 2017 
C) Half of the sales price will count as part of 2016 GDP and half will count as part of 2017 GDP. 
D) The production cost will count as part of 2016 GDP while the sales price will count as part of 2017 GDP. 
A) 2016 
B) 2017 
C) Half of the sales price will count as part of 2016 GDP and half will count as part of 2017 GDP. 
D) The production cost will count as part of 2016 GDP while the sales price will count as part of 2017 GDP.

Question 12

Suppose that nominal GDP in 2016 was less than real GDP in 2016.Given this information,we know for certain that

Accepted Answer

A) the price level in 2016 was greater than the price level in the base year. 
B) the price level in 2016 was less than the price level in the base year. 
C) real GDP in 2016 was less than real GDP in the base year. 
D) real GDP in 2016 was greater than real GDP in the base year. 
A) the price level in 2016 was greater than the price level in the base year. 
B) the price level in 2016 was less than the price level in the base year. 
C) real GDP in 2016 was less than real GDP in the base year. 
D) real GDP in 2016 was greater than real GDP in the base year.

Question 13

In periods when prices are falling,on average,

Accepted Answer

A) real GDP will grow slower than nominal GDP. 
B) real GDP will grow faster than nominal GDP. 
C) real GDP will grow as fast as nominal GDP. 
D) one cannot calculate real GDP. 
A) real GDP will grow slower than nominal GDP. 
B) real GDP will grow faster than nominal GDP. 
C) real GDP will grow as fast as nominal GDP. 
D) one cannot calculate real GDP.

Question 14

Table 8-18
   A very simple economy produces three goods: cameras,legal services,and books.The quantities produced and their corresponding prices for 2011 and 2016 are shown in the table above.
-Refer to Table 8-18.What is the GDP deflator in 2016 if 2016 is the base year?

Accepted Answer

A) 120 
B) 118 
C) 100 
D) 87 
A) 120 
B) 118 
C) 100 
D) 87

Question 15

The Bureau of Economic Analysis divides it's statistics on GDP into four major categories.List the categories of expenditures and define each.

Accepted Answer

The largest category of expenditures is

Question 16

Emily is a writer.She buys pens and paper for $20 and writes a 500-page novel that she sells to a publishing company for $500,000.If the publisher prints 1 million copies that sell for $25 each,what is the contribution to GDP of Emily's novel?

Accepted Answer

A) $25 million 
B) $20 million 
C) $500,000 
D) $50,000 
A) $25 million 
B) $20 million 
C) $500,000 
D) $50,000

Question 17

In calculating gross domestic product,the Bureau of Economic Analysis uses the sum of the market value of final goods and services produced.This means that the BEA

Accepted Answer

A) simply counts the total number of goods produced in the market place and then adds them up. 
B) values goods at their market prices,multiplies them by the quantity produced,and then adds them up. 
C) simply counts the total number of goods and services produced in the marketplace and then adds them up. 
D) values goods and services at their market prices,multiplies them by the quantity produced,and then adds them up. 
A) simply counts the total number of goods produced in the market place and then adds them up. 
B) values goods at their market prices,multiplies them by the quantity produced,and then adds them up. 
C) simply counts the total number of goods and services produced in the marketplace and then adds them up. 
D) values goods and services at their market prices,multiplies them by the quantity produced,and then adds them up.

Question 18

National income is defined as

Accepted Answer

A) gross national product plus transfer payments. 
B) gross national product less retained earnings plus transfer payments. 
C) gross domestic product less retained earnings plus transfer payments. 
D) gross domestic product less the consumption of fixed capital. 
A) gross national product plus transfer payments. 
B) gross national product less retained earnings plus transfer payments. 
C) gross domestic product less retained earnings plus transfer payments. 
D) gross domestic product less the consumption of fixed capital.

Question 19

If nominal GDP exceeds real GDP for a specific year,then the GDP deflator must be

Accepted Answer

A) equal to 100. 
B) greater than 100. 
C) less than 100. 
D) less than 0. 
A) equal to 100. 
B) greater than 100. 
C) less than 100. 
D) less than 0.

Question 20

In a small economy,gross investment is $1,500,consumption spending is $6,000,net investment is $200,government spending is $1,500,exports are $2,000 and imports are $1,000.What is GDP for this economy?

Accepted Answer

A) $10,700 
B) $10,300 
C) $10,200 
D) $10,000 
A) $10,700 
B) $10,300 
C) $10,200 
D) $10,000

In the circular flow diagram, supply the factors of production,and goods and services.

Table 8-17 A very simple economy produces three goods: movies,burgers,and bikes.The quantities produced and their corresponding prices for 2011 and 2016 are shown in the table above. -Refer to Table 8-17.What is nominal GDP in 2011?

An example of an intermediate good would be

The U.S.work week has declined from 60 hours in 1890 to 40 hours today.The impact of the decline in working hours

The purchase by a household in China of a CD produced in the United States is included in U.S.

In the circular flow model,the value of total income for an economy ________ the value of total production.

Government spending ________ is included in gross domestic product.

Table 8-11 Consider the following data for Tyrovia,a country that produces only two products: guns and butter. -Refer to Table 8-11.Nominal GDP for Tyrovia in 2016 equals

The circular flow diagram shows that

A car that is produced in 2016 is not sold until 2017.According to the definition of GDP,in which year's GDP should it be counted?

Suppose that nominal GDP in 2016 was less than real GDP in 2016.Given this information,we know for certain that

In periods when prices are falling,on average,

Table 8-18 A very simple economy produces three goods: cameras,legal services,and books.The quantities produced and their corresponding prices for 2011 and 2016 are shown in the table above. -Refer to Table 8-18.What is the GDP deflator in 2016 if 2016 is the base year?

The Bureau of Economic Analysis divides it's statistics on GDP into four major categories.List the categories of expenditures and define each.

Emily is a writer.She buys pens and paper for $20 and writes a 500-page novel that she sells to a publishing company for $500,000.If the publisher prints 1 million copies that sell for $25 each,what is the contribution to GDP of Emily's novel?

In calculating gross domestic product,the Bureau of Economic Analysis uses the sum of the market value of final goods and services produced.This means that the BEA

National income is defined as

If nominal GDP exceeds real GDP for a specific year,then the GDP deflator must be

In a small economy,gross investment is $1,500,consumption spending is $6,000,net investment is $200,government spending is $1,500,exports are $2,000 and imports are $1,000.What is GDP for this economy?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation,unemployment,and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

Exam 8: Gdp: Measuring Total Production and Income

In the circular flow diagram,________ supply the factors of production,and ________ goods and services.

Table 8-17 A very simple economy produces three goods: movies,burgers,and bikes.The quantities produced and their corresponding prices for 2011 and 2016 are shown in the table above. -Refer to Table 8-17.What is nominal GDP in 2011?

An example of an intermediate good would be

The U.S.work week has declined from 60 hours in 1890 to 40 hours today.The impact of the decline in working hours

The purchase by a household in China of a CD produced in the United States is included in U.S.

In the circular flow model,the value of total income for an economy ________ the value of total production.

Government spending ________ is included in gross domestic product.

Table 8-11 Consider the following data for Tyrovia,a country that produces only two products: guns and butter. -Refer to Table 8-11.Nominal GDP for Tyrovia in 2016 equals

The circular flow diagram shows that

A car that is produced in 2016 is not sold until 2017.According to the definition of GDP,in which year's GDP should it be counted?

Suppose that nominal GDP in 2016 was less than real GDP in 2016.Given this information,we know for certain that

In periods when prices are falling,on average,

Table 8-18 A very simple economy produces three goods: cameras,legal services,and books.The quantities produced and their corresponding prices for 2011 and 2016 are shown in the table above. -Refer to Table 8-18.What is the GDP deflator in 2016 if 2016 is the base year?

The Bureau of Economic Analysis divides it's statistics on GDP into four major categories.List the categories of expenditures and define each.

Emily is a writer.She buys pens and paper for $20 and writes a 500-page novel that she sells to a publishing company for $500,000.If the publisher prints 1 million copies that sell for $25 each,what is the contribution to GDP of Emily's novel?

In calculating gross domestic product,the Bureau of Economic Analysis uses the sum of the market value of final goods and services produced.This means that the BEA

National income is defined as

If nominal GDP exceeds real GDP for a specific year,then the GDP deflator must be

In a small economy,gross investment is $1,500,consumption spending is $6,000,net investment is $200,government spending is $1,500,exports are $2,000 and imports are $1,000.What is GDP for this economy?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency,government Price Setting,and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation,unemployment,and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters

In the circular flow diagram, supply the factors of production,and goods and services.