Deck 5: GDP: a Measure of Total Production and Income

Question 1

Undistributed profits_{-------------}counted as part of GDP because_{-------------}

A)are; they can be used to buy other goods.
B)are; firms are required to pay corporate income taxes on them.
C)are ; they are considered income paid to households and loaned back to firms.
D)are not; they are considered an intermediate good.
E)are not; households are not paid by the firms.

Answer 1

are ; they are considered income paid to households and loaned back to firms.

Question 2

Janet calculated the GDP growth rates for France between 2012 and 2013. Using 2012 prices for both years, GDP increased 5 percent. Using 2013 prices for both years, GDP increased 1 percent. hence the chained-price method will calculate that between these years, real GDP increased by

A)5 percent.
B)4 percent.
C)1 percent.
D)6 percent.
E)3 percent.

Answer 2

3 percent.

Question 3

Real GDP measures the value of goods and services produced in a given year using

A)prices of that same year.
B)base year prices.
C)government approved prices.
D)no prices.
E)future prices.

Answer 3

B

Question 4

Which of the following is true regarding the measurement of GDP?

A)Consumption and investment are used in the income approach to GDP.
B)Investment and wages are expenditures , and are therefore are used in the expenditure approach to GDP.
C)Wages and consumption are used in the expenditure approach to GDP.
D)Government expenditure is only counted in the income approach to GDP.
E)Wages and profit income are used in the income approach to GDP.

Question 5

The base year is 2011. A country only produces Blu-ray players. The price of a Blu-ray player in 2011 was $100. The price of a Blu-ray player was $90 in 2012. The quantity of Blu-ray players Produced in 2011 was 10,000 units and in 2012 was 10,500 units. Nominal GDP in 2012 equals

A)$1,050,000.
B)$900,000.
C)$945,000.
D)$1,000,000.
E)an amount that cannot be determined without information about nominal GDP in 2008.

Question 6

How are final goods and services valued when measuring nominal GDP?

A)at producer cost
B)at base year prices
C)at factor market prices
D)at foreign exchange parity
E)at current market prices

Question 7

Which of the following goods and services are omitted from GDP?

A)capital goods
B)expenditure on resources used to protect the environment
C)government weather satellites
D)household production
E)services such as hair stylings

Question 8

In calculating GDP, we must

A)add the market value of imports and subtract the market value of exports.
B)add the market value of exports and subtract the market value of imports.
C)exclude net exports of goods and services (NX).
D)subtract the market value of imports, because these goods are produced in a country other than the United States, and subtract the market value of exports, because these goods are consumed in a country other than the United States.
E)add the value of the goods produced outside of the United States by American firms.

Question 9

$\begin{array}{lllll}&\text { Data for } 2009&&\text { Data for } 2010\\\hline\text { Item}&\text{ Quantity}&\text{ Price}&\text{ Quantity }&\text{ Price }\\\hline\text { Bread } & 50 & \$ 4.00 & 70 & \$ 3.00 \\\text { Soda } & 50 & \$ 5.00 & 50 & \$ 6.00 \\\hline\end{array}$
The table above gives the production and prices for a small nation that produces only bread and soda.

-The base year is 2010. What is real GDP in 2010?

A)$1080
B)$530
C)$210
D)$510
E)$300

Question 10

U.S. real GDP

A)is not as accurate as nominal GDP when measuring standard of living changes over time.
B)precisely measures the improving standard of living in the United States.
C)measures the change in the price level over time.
D)includes the value of underground production but excludes the value of leisure time.
E)excludes the value of underground production and leisure time.

Question 11

In 2009 in the United States, net domestic product at factor cost was $11,091 billion. Additionally, rent was $2,000 billion, profits were $1,000 billion, and interest was $358 billion. Hence wages were

A)$9,091 billion.
B)$12,091 billion.
C)$10,091 billion.
D)$8,091 billion.
E)$7,733 billion.

Question 12

Consumption expenditure includes spending

A)by governments when they are buying goods and services that consumers also buy.
B)by households.
C)on intermediate goods and services by firms.
D)by households and spending on office supplies by firms.
E)on office supplies by firms.

Question 13

Economists define investment to include purchases of

A)capital goods, such as tools, instruments, and buildings.
B)capital goods, household durable goods, and inventories.
C)capital goods and inventories.
D)capital goods, equity stocks, and inventories.
E)capital goods, equity stocks, and bonds.

Question 14

Which of the following is NOT included in the expenditure approach to calculating GDP?

A)consumption expenditure
B)net exports of goods and services
C)government expenditures on goods and services
D)investment
E)wages

Question 15

A business cycle has two turning points, which are the

A)peak and recession.
B)recession and trough.
C)peak and expansion.
D)trough and peak.
E)expansion and recession.

Question 16

The value of leisure time is

A)directly included in GDP but, in recent years, has become a decreasing large part of GDP.
B)zero.
C)included in GDP and, in recent years, has become an increasing large part of GDP.
D)excluded from GDP.
E)directly included in GDP and, in recent years, has not changed much as a fraction of GDP.

Question 17

Last year in Candamica, consumption expenditure was $20 billion, interest, rent, and profit were $2.5 billion, government expenditure on goods and services was $7 billion, net exports of goods and services was $5 billion, and investment was $2 billion. Hence total expenditure was

A)$34.5 billion.
B)$36.5 billion.
C)$34 billion.
D)$24.5 billion.
E)undetermined without information about imports.

Question 18

Real GDP measures the value of goods and services produced in a given year valued using

A)base year prices.
B)prices that prevail the same year.
C)real rather than nominal prices.
D)future prices.
E)no prices.

Question 19

In one year, a firm increases its production by $9 million and increases sales by $8 million. All other things in the economy remaining the same, which of the following is true?

A)GDP increases by $8 million and inventory investment decreases by $1 million.
B)Inventory investment decreases by $1 million.
C)GDP increases by $9 million and inventory investment increases by $1 million.
D)GDP increases by $17 million.
E)GDP increases by $8 million and investment increases by $1 million.

Question 20

Depreciation is

A)part of net domestic product at factor cost.
B)the decrease in the purchasing power of a dollar because of inflation.
C)fall in the value of an exchange rate.
D)part of consumption expenditure.
E)the decrease in the value of capital resulting from its use and obsolescence.

Question 21

Instead of taking the dirty laundry with you when you go back to visit your parents, you use a Laundromat. Your use of the Laundromat means that

A)what you paid for use of the Laundromat will be included in GDP.
B)real GDP does not change because the clothes are still being laundered but nominal GDP rises since you are now paying for the service.
C)GDP will remain the same.
D)your parents' contribution to GDP will increase.
E)GDP will decrease and the country's standard of living will fall.

Question 22

In recent years, which of the following has been negative?

A)wages
B)government expenditure on goods and services
C)investment
D)consumption expenditure
E)net exports of goods and services

Question 23

If nominal GDP increases from one year to the next, then

A)prices and production must both have decreased.
B)production could have increased, decreased, or stayed the same.
C)production must have increased.
D)prices and production must both have increased.
E)prices must have increased.

Question 24

Bob's Funky T-shirts began the year with 1,000 shirts in inventory, produced 10,000 shirts during the year and ended the year with 1,100 shirts in inventory. The 100 shirts added to his inventory will be classified as

A)investment.
B)exports of goods and services.
C)nondurable consumption goods.
D)consumption expenditure.
E)net exports of goods and services.

Question 25

Total expenditure equals total income

A)if firms earn zero profit.
B)if firms do not save for future investment.
C)because firms pay out everything they receive as income to the factors of production.
D)only if net taxes equals government expenditures on goods and services.
E)only if firms sell all the goods they produce in a given time period.

Question 26

Using the chained-dollar method to calculate real GDP, real GDP is calculated by

A)averaging the growth of output from one year to the next when the growth rates are calculated using this year's prices and using last year's prices.
B)valuing the current output at last year's real GDP prices.
C)valuing the current output at current year prices.
D)either A or C, depending which gives the larger value for real GDP.
E)averaging the value of current output valued using base year prices and current output valued using current year prices.

Question 27

To calculate GDP it is necessary to add up the market value of all the_{--------------------} produced within a country during a year.

A)goods but not services produced
B)intermediate goods and services produced
C)goods and services produced
D)intermediate goods and services produced and all the final goods and services produced
E)final goods and services produced

Question 28

GDP is

A)an imperfect measure of the standard of living.
B)the only factor that affects our standard of living.
C)a perfect measure of the value of production.
D)a perfect measure of the standard of living.
E)a measure which includes the value of all newly produced goods and services.

Question 29

In 1961, real GDP totaled $575 billion and in 2011 it totaled $1,255 billion. Between 1961 and 2011, the population increased from 50 million to 100 million. Between 1961 and 2011, the standard of living based on real GDP per person

A)increased from $11,500 to $12,550.
B)decreased from $125,500 to $28,750.
C)increased by about 118 percent.
D)decreased by 9 percent.
E)increased by over 300 percent.

Question 30

In the business cycle, what immediately precedes the time when real GDP is falling?

A)recession
B)peak
C)depression
D)expansion
E)trough

Question 31

Which of the following is likely to be an unreported economic activity?

A)the purchase of shares of stock in Walgreen's Pharmacy
B)the minimum wage paid to a teenager working at a McDonald's
C)a $250,000 bonus paid to the CEO of a company
D)the brokerage fees paid to a broker at Merrill Lynch
E)tips paid to a taxi driver

Question 32

Which adjustment(s)must be made to convert net domestic product to GDP?
i.add indirect taxes
ii.subtract subsidies
iii)add depreciation

A)i and iii only
B)iii only
C)ii only
D)i, ii and iii
E)i and ii

Question 33

The expenditure approach to measuring GDP is based on summing

A)each industry's production.
B)consumption expenditure, investment, government expenditure on goods and services, and net exports of goods and services minus wages, interest, rent, and profit.
C)the total values of final goods, intermediate goods and services, used goods, and financial assets.
D)wages, interest, rent, and profit.
E)consumption expenditure, investment, government expenditure on goods and services, and net exports of goods and services.

Question 34

$\begin{array} { l c } \hline { \text { Item } } & \text { Billions of dollars } \\\hline \text { Consumption expenditure } & 4,000 \\\text { Interest, rent, and profit } & 300 \\\text { Investment } & 1,000 \\\text { Depreciation } & 400 \\\text { Government expenditure on goods and services } & 1,000 \\\text { Net exports of goods and services } & 200 \\\hline\end{array}$
The table gives data for a nation. What is the amount of the country's GDP?

A)$6,200 billion
B)$6,000 billion
C)$6,900 billion
D)$6,600 billion
E)$5,800 billion.

Question 35

_{-------------}is most likely to contribute to an improvement in our living standard.

A)A decrease in nominal GDP
B)An increase in the GDP deflator combined with a decrease in nominal GDP
C)An increase in the price level
D)An increase in depreciation
E)An increase in real GDP

Question 36

$\begin{array}{lllll}&\text { Data for } 2012&&\text { Data for } 2013\\\hline\text { Item}&\text{ Quantity}&\text{ Price}&\text{ Quantity }&\text{ Price }\\\hline \text { Bananas } & 100 & \$ 2.00 & 125 & \$ 4.00 \\\text { Sunscreen } & 60 & \$ 5.00 & 75 & \$ 4.00\\\hline\end{array}$
Bananaland produces only bananas and sunscreen and the quantities and prices for 2012 and 2013 are given in the table above.

-The base year is 2012. Nominal GDP in 2013 is equal to

A)$625.
B)$500.
C)$640.
D)$800.
E)$200.

Question 37

To measure GDP by using the income approach, we must add all incomes and then _{--------------------} depreciation and _ net taxes less subsidies.

A)neither add nor subtract; add
B)add; neither add nor subtract
C)add; subtract
D)add; add
E)subtract; add

Question 38

A restaurant buys fish to offer as a daily menu special. The purchase of the fish by the restaurant is

A)part of net exports if the fish was caught beyond the U.S. border.
B)an example of government expenditures on goods and services.
C)a consumption expenditure.
D)an investment.
E)an intermediate good.

Question 39

Based on the figure above, in which quarter or quarters did an expansion occur?

A)in 2005, 2nd quarter
B)between 2005, 2nd quarter to 2006, 2nd quarter
C)between 2004, 2nd quarter to 2005, 2nd quarter and also between 2006, 2nd quarter to the end of the figure
D)in 2006, 2nd quarter
E)There are no expansions illustrated in the figure.

Question 40

One reason the total sum of the income categories does not equal GDP is that

A)taxes are generally larger than subsidies and the depreciation of capital is negligible.
B)people do not spend all their income, so the value of consumption expenditure is less than the value of wages.
C)GDP values goods and services at market prices and the income approach values them at factor cost.
D)GDP values goods and services at retail prices and the income approach values them at wholesale cost.
E)GDP does not include depreciation, which is part of the income categories.

Question 41

A recession conventionally is defined as a decrease in

A)real GDP that lasts for at least three months.
B)real GDP that lasts for at least six months.
C)potential GDP that lasts for at least six months.
D)the growth rate of real GDP that lasts for at least six months.
E)the inflation rate that lasts for at least six months.

Question 42

GDP handles household production by

A)estimating a dollar value of the goods purchased to do housework.
B)including it in real GDP but not in nominal GDP because there are no prices paid for the work.
C)estimating a dollar value of the services provided.
D)ignoring it.
E)including it in exactly the same way that all other production is included.

Question 43

Which of the following describe the United States economy in 2008 and and the start of 2009?

A)Real GDP reached a peak.
B)Real GDP per person increased.
C)The economy was in a recession.
D)The economy was in an expansion.
E)None of the above answers is correct.

Question 44

Which of the following is NOT part of the income used in the income approach to measuring GDP?

A)taxes paid by persons
B)profit
C)rent
D)wages
E)interest

Question 45

If we use GDP to measure our standard of living, then our procedure is

A)accurate because our standard of living depends solely on goods and services.
B)inaccurate because our standard of living has nothing to do with goods and services.
C)inaccurate because our standard of living only depends on used goods and services.
D)accurate only if we use nominal GDP rather than real GDP.
E)inaccurate because our standard of living does not depend only on goods and services.

Question 46

During last year, a country produced 20,000 pizzas and 10,000 hamburgers and nothing else. The pizzas sold for $10.00 each and the hamburgers for $3.00 each. Nominal GDP was

A)$390,000.
B)$230,000.
C)$460,000.
D)$360,000.
E)$70,000.

Question 47

Babysitting services the oldest son provides his parents

A)counts as nominal GDP but not real GDP.
B)counts in both real and nominal GDP only if the son is not paid.
C)counts as real GDP and nominal GDP.
D)does not count as real GDP nor nominal GDP.
E)counts as real GDP but not nominal GDP.

Question 48

Which of the following is included as investment in GDP?
i. cars produced during the year but unsold at the end of the year
ii. new capital equipment produced and purchased during the year
iii. purchases of a company's stocks and bonds

A)i only
B)i, ii, and iii
C)iii only
D)ii only
E)i and ii

Question 49

Gross Domestic Product is defined to be the market value of all the final goods and services produced during a given time period

A)within a country.
B)by citizens of the country, regardless of their place of residence.
C)within a county minus the market value of all the final goods and services produced by that country's citizens outside the country.
D)by only legal residents of the country.
E)within and outside a country by that country's citizens.

Question 50

In order to be classified as a recession, a contraction of general economic activity must last at least

A)one period.
B)one year.
C)one quarter.
D)six months.
E)None of the above because recessions do not have a minimum length.

Question 51

The base year is 2012. A country only produces Blu-ray players. The price of a Blu-ray player in 2012 was $100. The price of a Blu-ray player was $90 in 2013. The quantity of Blu-ray players Produced in 2012 was 10,000 units and in 2013 was 10,500 units. Real GDP in 2012 equals

A)$945,000.
B)$1,000,000.
C)$900,000.
D)$1,050,000.
E)an amount that cannot be determined without information about real GDP in 2007 .

Question 52

Because of the circular flows of expenditure and income in the economy, total _{-------------} equals total_{-------------}
Equals total_{-------------} .

A)expenditure; investment; income
B)expenditure; income; value of production
C)consumption; investment; expenditure
D)investment; income; consumption
E)consumption; expenditure; value of production

Question 53

The difference between nominal GDP and real GDP is

A)that nominal GDP includes the depreciation of capital and real GDP does not.
B)that nominal GDP includes net exports of goods and services and real GDP includes net imports.
C)that real GDP includes the depreciation of capital and nominal GDP does not.
D)the indirect taxes used in their calculations.
E)the prices used in their calculations.

Question 54

Investment includes

A)student purchases of laptops.
B)GM's purchase of robotic machinery.
C)the New York City Library's purchase of new books.
D)wages paid to military personnel.
E)Walmart's purchase of health insurance for its workers.

Question 55

Based on the figure above, in which quarter or quarters did a recession occur?

A)in 2005, 2nd quarter
B)between 2005, 2nd quarter to 2006, 2nd quarter
C)after 2005, 2nd quarter
D)between 2006, 1st quarter to 2006 2nd quarter
E)between 2004, 2nd quarter to 2005, 2nd quarter and also between 2006, 2nd quarter to the end of the figure

Question 56

Based on the figure above, in which quarter or quarters did a trough occur?

A)between 2005, 2nd quarter to 2006, 2nd quarter
B)in 2005, 2nd quarter
C)in 2006, 2nd quarter
D)between 2004, 2nd quarter to 2005, 2nd quarter and also between 2006, 2nd quarter to the end of the figure
E)There are no troughs illustrated in the figure.

Question 57

Nominal GDP measures the value of goods and services produced in a given year valued using

A)no prices.
B)prices of the same year.
C)base year prices.
D)constant prices.
E)future prices.

Question 58

If consumption was 70 percent of GDP and investment and government expenditure were both 18 percent each, then we see that

A)we must subtract depreciation from investment so that the components of GDP do not exceed 100 percent.
B)exports must be more than imports.
C)GDP can be over 100 percent because it is "gross" rather than "net."
D)the error is due to rounding.
E)exports must be less than imports.

Question 59

$\begin{array} { l c c c c } & { \text { Date for } \mathbf { 2 0 1 2 } } & & { \text { Data for } \mathbf { 2 0 1 3 } } \\\hline { \text { Item } } & \text { Quantity } & \text { Price } & \text { Quantity } & \text { Price } \\\hline \text { Bananas } & 100 & \$ 2.00 & 125 & \$ 4.00 \\\text { Sunscreen } & 60 & \$ 5.00 & 75 & \$ 4.00 \\\hline\end{array}$

Bananaland produces only bananas and sunscreen and the quantities and prices for 2012 and 2013 are given in the table above.

-The base year is 2012. In 2013, which is larger: Nominal GDP or real GDP?

A)real GDP is larger
B)both are the same size
C)the answer is ambiguous
D)nominal GDP is larger
E)More information is needed to determine which is larger.

Question 60

According to the income approach to measuring GDP, the largest income category is

A)rent.
B)wages.
C)consumption expenditure.
D)profits.
E)interest.

Question 61

Which of the following would NOT be directly included in the U.S. GDP in 2010?

A)the value of the automobiles produced in 2010 at the Toyota plant located in Georgetown, KY
B)the market value of the jet fuel bought by Delta to use for its flights in 2010
C)the purchase of a new home in Atlanta, Georgia in 2010
D)legal services provided to first time home buyers during 2010
E)the market value of restaurant meals sold in 2010

Question 62

During the business cycle,

A)real GDP fluctuates around nominal GDP.
B)real GDP falls after the trough.
C)trend GDP fluctuates around real GDP.
D)nominal GDP fluctuates around real GDP.
E)real GDP fluctuates around its trend.

Question 63

Total expenditure equals

A)C + I + G + NX.
B)C - I + G + NX.
C)C + I + G - NX.
D)C - I - G - NX.
E)C + I - G + NX.

Question 64

According to the expenditure approach to measuring GDP, in the United States , the largest component of GDP is

A)government expenditure on goods and services.
B)investment.
C)wages.
D)consumption expenditure.
E)net exports of goods and services.

Question 65

$\begin{array}{lllll}&\text { Data for } 2009&&\text { Data for } 2010\\\hline\text { Item}&\text{ Quantity}&\text{ Price}&\text{ Quantity }&\text{ Price }\\\hline\text { Bread } & 50 & \$ 4.00 & 70 & \$ 3.00 \\\text { Soda } & 50 & \$ 5.00 & 50 & \$ 6.00 \\\hline\end{array}$
The table above gives the production and prices for a small nation that produces only bread and soda.

-
The base year is 2009. What is nominal GDP in 2009?

A)$900
B)$410
C)$550
D)$450
E)$460

Question 66

A south sea island produces only coconuts. In 2012, the price of a coconut is $1 and the quantity produced is 200. In 2013, the price of a coconut is $1.50 and the quantity produced is 250. 2012 is the base year. Real GDP in 2013 is _{--------------------}.

A)$200
B)$1.50
C)$375
D)$350
E)$250

Question 67

An increase in nominal GDP could result from an increase in
i. production.
ii. prices.
iii. subsidies.

A)i and ii
B)ii only
C)i and iii
D)i only
E)i, ii, and iii

Question 68

The value of used goods_{-------------}counted as part of GDP_{-------------}

A)are not; because most fall in value and would cause a decrease in the value of GDP
B)are; as long as they are classified as consumption goods
C)are not; because they were counted during the period when they were counted as new goods
D)are; as long as they are classified as investment goods
E)may be; as long as their value has risen

Question 69

In measuring GDP, which of the following is included?

A)the value of stocks and bonds bought and sold
B)the value of durable consumption goods but not the value of nondurable consumption goods.
C)the value of preparing meals at home
D)the value of increases in business inventories
E)the value of used goods when they are sold

Question 70

Gross Domestic Product equals

A)Y = C + I + G + NX.
B)Y = C - I + G + NX.
C)Y = C + I - G + NX.
D)Y = C + I + G - NX.
E)Y = C - I - G - NX.

Question 71

The purchase of a new Boeing fighter jet by Israel is classified in the U.S. GDP accounts as

A)investment expenditure.
B)export expenditure.
C)import expenditure.
D)government expenditure.
E)consumption expenditure.

Question 72

Which of the following statement is correct?

A)If nominal GDP decreases, then real GDP must increase.
B)If nominal GDP increases, then real GDP must increase.
C)If real GDP decreases, then nominal GDP must decrease.
D)If nominal GDP does not change, then real GDP cannot change.
E)Nominal and real GDP can change either in the same direction or the opposite direction.

Question 73

$\begin{array} { l c c c c } & { \text { Date for } \mathbf { 2 0 1 2 } } & & { \text { Data for } \mathbf { 2 0 1 3 } } \\\hline { \text { Item } } & \text { Quantity } & \text { Price } & \text { Quantity } & \text { Price } \\\hline \text { Bananas } & 100 & \$ 2.00 & 125 & \$ 4.00 \\\text { Sunscreen } & 60 & \$ 5.00 & 75 & \$ 4.00 \\\hline\end{array}$

Bananaland produces only bananas and sunscreen and the quantities and prices for 2012 and 2013 are given in the table above.

- Between 2012 and 2013, which grew more rapidly: Nominal GDP or real GDP?

A)Because real GDP and nominal GDP use different prices, it is not possible to determine which grew most rapidly.
B)both grew at the same rate
C)real GDP grew more rapidly
D)nominal GDP grew more rapidly
E)More information is needed to determine which grew more rapidly.

Question 74

When industrial activity increases _{-------------}

A)health and life expectancy decrease
B)the increase in real GDP is partially offset by the increase in pollution
C)and real GDP increases, it is the case that in all nations fewer resources are devoted to protecting the environment
D)pollution does not necessarily increase
E)GDP decreases because of pollution

Question 75

When measuring GDP,

A)the government sector is not included because it is the public sector not the private sector.
B)only the federal government's expenditure on goods and services are included.
C)the government sector is counted, and the value of the government sector in GDP is equal to its tax revenue.
D)the expenditure on goods and services by all levels of government are included.
E)the government sector is not counted because it does not produce goods and services.

Question 76

Which of the following would be included in Germany's GNP?

A)the production of BMWs (made by a German-based company)in South Carolina
B)the production of Michelin tires made in Germany by a French company and then sold directly to French consumers
C)the production of BMWs in Germany
D)the production of Michelin tires made in France by a French company and then sold to BMW in Germany for use in BMW cars
E)Answers A and C are correct.

Question 77

Which of the following is classified as a final good or service?
i. tires bought by GM to put on new Tahoes
ii. mustard bought by Subway to put on its sub sandwiches
iii. your purchase of online access to the Wall Street Journal

A)i, ii and iii
B)iii only
C)ii only
D)i and ii
E)ii and iii

Question 78

The NBER describes a recession as

A)"a decrease in the standard of living for at least one year."
B)"a decrease in real GDP for two successive quarters."
C)"a period of significant decline in total output, income, employment, and trade, usually lasting from six months to a year."
D)"a decrease in potential GDP for at least six months."
E)"a one year period with increases in the unemployment rate."

Question 79

Which of the following is NOT included in measured U.S. GDP?

A)the value of the goods produced at a French owned plant in Atlanta, GA
B)the value of the services produced by a lawyer in Tampa, FL
C)the value of a plane produced by Boeing in Washington and sold to Air France
D)the value of leisure time
E)the value of the pizzas produced at Pizza Hut in Kansas City

Question 80

$\begin{array} { l c c c c } & { \text { Date for } \mathbf { 2 0 1 2 } } & & { \text { Data for } \mathbf { 2 0 1 3 } } \\\hline { \text { Item } } & \text { Quantity } & \text { Price } & \text { Quantity } & \text { Price } \\\hline \text { Bananas } & 100 & \$ 2.00 & 125 & \$ 4.00 \\\text { Sunscreen } & 60 & \$ 5.00 & 75 & \$ 4.00 \\\hline\end{array}$

Bananaland produces only bananas and sunscreen and the quantities and prices for 2012 and 2013 are given in the table above.

- The base year is 2012. Real GDP in 2012 is equal to

A)$800.
B)$640.
C)$200.
D)$500.
E)$625.