Question 1

To calculate GDP by the expenditure method,one must add

Accepted Answer

A) wages,rents,interest,and profits. 
B) consumption spending,investment spending,government spending,and net exports. 
C) consumption spending,investment spending,government spending,and exports. 
D) labor,natural resources,entrepreneurship,and capital. 
A) wages,rents,interest,and profits. 
B) consumption spending,investment spending,government spending,and net exports. 
C) consumption spending,investment spending,government spending,and exports. 
D) labor,natural resources,entrepreneurship,and capital.

Question 2

Table 8-29
  
-Refer to Table 8-29.Based on the table above,what is national income for this economy?

Accepted Answer

A) $4,700 billion 
B) $4,000 billion 
C) $3,150 billion 
D) $2,450 billion 
A) $4,700 billion 
B) $4,000 billion 
C) $3,150 billion 
D) $2,450 billion

Question 3

Table 8-19
  
-Refer to Table 8-19.Given the information above,calculate the GDP deflator in 2015.

Accepted Answer

A) 87 
B) 95 
C) 105 
D) 114 
A) 87 
B) 95 
C) 105 
D) 114

Question 4

Suppose in 2016,you purchase a house built in 2003.Which of the following would be included in the gross domestic product for 2016?

Accepted Answer

A) the value of the house in 2016 
B) the value of the house in 2003 
C) the value of the house in 2016 minus depreciation 
D) the value of the services of the real estate agent 
A) the value of the house in 2016 
B) the value of the house in 2003 
C) the value of the house in 2016 minus depreciation 
D) the value of the services of the real estate agent

Question 5

Presently,GDP is ________ to compensate for the costs of environmental damage.

Accepted Answer

A) fully adjusted 
B) partially adjusted 
C) adjusted on a chain-weight basis 
D) not adjusted 
A) fully adjusted 
B) partially adjusted 
C) adjusted on a chain-weight basis 
D) not adjusted

Question 6

Scenario 8-1
CANOES-R-US makes canoes.It buys the shell of the canoe from another firm for $300 and uses its labor and intermediate goods to make the canoe.It sells the finished canoe to a retail canoe store for $800.The retail canoe store then sells the canoe to a consumer for $1,200.
-Refer to Scenario 8-1.The value added of CANOES-R-US for each canoe equals

Accepted Answer

A) $1,200. 
B) $800. 
C) $500. 
D) $400. 
A) $1,200. 
B) $800. 
C) $500. 
D) $400.

Question 7

Gross domestic product is generally ________ national income.

Accepted Answer

A) greater than 
B) less than 
C) equal to 
D) unrelated to 
A) greater than 
B) less than 
C) equal to 
D) unrelated to

Question 8

Table 8-14
  
-Refer to Table 8-14.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2016 equals

Accepted Answer

A) 92.2. 
B) 102.6. 
C) 108.5. 
D) 109.1. 
A) 92.2. 
B) 102.6. 
C) 108.5. 
D) 109.1.

Question 9

Personal income is defined as

Accepted Answer

A) national income less retained earnings plus transfer payments and plus interest on government bonds. 
B) national income plus retained earnings less transfer payments and less interest on government bonds. 
C) national income less depreciation. 
D) national income less personal taxes. 
A) national income less retained earnings plus transfer payments and plus interest on government bonds. 
B) national income plus retained earnings less transfer payments and less interest on government bonds. 
C) national income less depreciation. 
D) national income less personal taxes.

Question 10

In the first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as ________ when purchased by households and ________ when purchased by businesses.

Accepted Answer

A) nondurable goods;durable goods 
B) consumption;investment 
C) investment;consumption 
D) durable goods;nondurable goods 
A) nondurable goods;durable goods 
B) consumption;investment 
C) investment;consumption 
D) durable goods;nondurable goods

Question 11

Suppose that in 2016,the national income in the United States was $200 billion,depreciation was $15 billion,personal taxes were $20 billion,and transfer payments were $10 billion.Gross domestic product in 2016 is

Accepted Answer

A) $185 billion. 
B) $215 billion. 
C) $220 billion. 
D) $245 billion. 
A) $185 billion. 
B) $215 billion. 
C) $220 billion. 
D) $245 billion.

Question 12

An example of an intermediate good would be

Accepted Answer

A) the bread that goes into a sub sandwich that is sold by Quiznos. 
B) the soda pop sold by Quiznos. 
C) a sub sandwich sold by Quiznos. 
D) the potato chips sold by Quiznos. 
A) the bread that goes into a sub sandwich that is sold by Quiznos. 
B) the soda pop sold by Quiznos. 
C) a sub sandwich sold by Quiznos. 
D) the potato chips sold by Quiznos.

Question 13

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 real GDP in 2016,using 2011 as the base year?

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 14

Table 8-23
2011 2016
  
-Refer to Table 8-23.Suppose that a very simple economy produces three goods: pizzas,haircuts,and backpacks.Suppose the quantities produced and their corresponding prices for 2011 and 2016 are shown in the table above.Use the information to compute real GDP in the year 2011 and 2016.Assume that 2011 is the base year.Is output higher in 2016 or 2011? Why?

Accepted Answer

Recall that real GDP is found by valuing

Question 15

Describe briefly how the final value of an iPhone must be equal to the sum of incomes generated by the production of the iPhone.

Accepted Answer

Consider the value of an iPhone which co

Question 16

Which of the following statements is true?

Accepted Answer

A) A decrease in the crime rate increases GDP as people will spend more on security. 
B) Household production is counted in GDP as it amounts to real production. 
C) GDP accounting rules do not adjust for production that pollutes the economy. 
D) GDP growth distributes income equally to people in the economy. 
A) A decrease in the crime rate increases GDP as people will spend more on security. 
B) Household production is counted in GDP as it amounts to real production. 
C) GDP accounting rules do not adjust for production that pollutes the economy. 
D) GDP growth distributes income equally to people in the economy.

Question 17

Disposable personal income equals personal income

Accepted Answer

A) minus personal tax payments. 
B) plus government transfer payments. 
C) minus personal tax payments plus government transfer payments. 
D) minus government transfer payments plus personal tax payments. 
A) minus personal tax payments. 
B) plus government transfer payments. 
C) minus personal tax payments plus government transfer payments. 
D) minus government transfer payments plus personal tax payments.

Question 18

Which of the following headlines would be more closely related to what macroeconomists study than what microeconomists study?

Accepted Answer

A) Avocado prices rise due to a late frost in California. 
B) The United Auto Workers sign a contract raising wages and benefits 7% over the next 3 years. 
C) Real GDP grows by 2.3% in the second quarter. 
D) Airlines raise ticket prices in response to rising fuel costs. 
A) Avocado prices rise due to a late frost in California. 
B) The United Auto Workers sign a contract raising wages and benefits 7% over the next 3 years. 
C) Real GDP grows by 2.3% in the second quarter. 
D) Airlines raise ticket prices in response to rising fuel costs.

Question 19

If prices in the economy rise,then

Accepted Answer

A) the purchasing power of a dollar rises. 
B) the purchasing power of a dollar stays constant. 
C) the purchasing power of a dollar declines. 
D) the purchasing power of a dollar cannot be determined. 
A) the purchasing power of a dollar rises. 
B) the purchasing power of a dollar stays constant. 
C) the purchasing power of a dollar declines. 
D) the purchasing power of a dollar cannot be determined.

Question 20

Increases in real GDP would overstate the increase in the well-being of a country over time if,over that time period,the

Accepted Answer

A) average hours worked per week increased. 
B) amount of pollution decreased. 
C) price level increased. 
D) crime rate decreased. 
A) average hours worked per week increased. 
B) amount of pollution decreased. 
C) price level increased. 
D) crime rate decreased.

To calculate GDP by the expenditure method,one must add

Table 8-29 -Refer to Table 8-29.Based on the table above,what is national income for this economy?

Table 8-19 -Refer to Table 8-19.Given the information above,calculate the GDP deflator in 2015.

Suppose in 2016,you purchase a house built in 2003.Which of the following would be included in the gross domestic product for 2016?

Presently,GDP is ________ to compensate for the costs of environmental damage.

Gross domestic product is generally ________ national income.

Table 8-14 -Refer to Table 8-14.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2016 equals

Personal income is defined as

In the first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as when purchased by households and when purchased by businesses.

Suppose that in 2016,the national income in the United States was $200 billion,depreciation was $15 billion,personal taxes were $20 billion,and transfer payments were $10 billion.Gross domestic product in 2016 is

An example of an intermediate good would be

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 real GDP in 2016,using 2011 as the base year?

Describe briefly how the final value of an iPhone must be equal to the sum of incomes generated by the production of the iPhone.

Which of the following statements is true?

Disposable personal income equals personal income

Which of the following headlines would be more closely related to what macroeconomists study than what microeconomists study?

If prices in the economy rise,then

Increases in real GDP would overstate the increase in the well-being of a country over time if,over that time period,the

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

To calculate GDP by the expenditure method,one must add

Table 8-29 -Refer to Table 8-29.Based on the table above,what is national income for this economy?

Table 8-19 -Refer to Table 8-19.Given the information above,calculate the GDP deflator in 2015.

Suppose in 2016,you purchase a house built in 2003.Which of the following would be included in the gross domestic product for 2016?

Presently,GDP is ________ to compensate for the costs of environmental damage.

Gross domestic product is generally ________ national income.

Table 8-14 -Refer to Table 8-14.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2016 equals

Personal income is defined as

In the first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as ________ when purchased by households and ________ when purchased by businesses.

Suppose that in 2016,the national income in the United States was $200 billion,depreciation was $15 billion,personal taxes were $20 billion,and transfer payments were $10 billion.Gross domestic product in 2016 is

An example of an intermediate good would be

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 real GDP in 2016,using 2011 as the base year?

Describe briefly how the final value of an iPhone must be equal to the sum of incomes generated by the production of the iPhone.

Which of the following statements is true?

Disposable personal income equals personal income

Which of the following headlines would be more closely related to what macroeconomists study than what microeconomists study?

If prices in the economy rise,then

Increases in real GDP would overstate the increase in the well-being of a country over time if,over that time period,the

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 first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as when purchased by households and when purchased by businesses.