Question 1

Which of the following is the best example of an intermediate good? &#160;&#10;A)&#160;the flowers Mr. Grover buys at a local nursery&#160;&#10;B)&#160;the flour Grandma Grover buys to make a birthday cake&#160;&#10;C)&#160;the flour that Joe buys so that he can eat pizza three nights a week&#160;&#10;D)&#160;the flour Amy orders each month for the bakery she manages

Accepted Answer

&#160;the flour Amy orders each month for the bakery she manages

Question 2

Which of the following is the best example of an intermediate good or service? &#160;&#10;A)&#160;any good or service bought by a household, rather than by a firm&#160;&#10;B)&#160;pizzas bought at a restaurant&#160;&#10;C)&#160;legal services hired by a public accounting firm&#160;&#10;D)&#160;a professional performance of The Phantom of the Opera

Accepted Answer

&#160;legal services hired by a public accounting firm&#160;

Question 3

Which of the following is NOT included in GDP? &#160;&#10;A)&#160;the increase in business inventories in the period&#160;&#10;B)&#160;expenditures by government for newly produced goods and services in a given period&#160;&#10;C)&#160;the value of underground activities&#160;&#10;D)&#160;household spending on electricity

Accepted Answer

&#160;the value of underground activities&#160;

Question 4

If GDP rises, what happens to income and expenditure? &#160;&#10;A)&#160;Income and expenditure must rise.&#160;&#10;B)&#160;Income and expenditure must fall.&#160;&#10;C)&#160;Income must rise, but expenditure may rise or fall.&#160;&#10;D)&#160;Expenditure must rise, but income may rise or fall.

Accepted Answer

The answer of If GDP rises, what happens to income...

Question 5

Which of the following would be included in last year's GDP? &#160;&#10;A)&#160;100 shares of IBM stock that Tony bought in May&#160;&#10;B)&#160;the used car Tracey sold to Justin in June&#160;&#10;C)&#160;George's purchase of a fishing rod and reel at a garage sale in August&#160;&#10;D)&#160;the bucket of KFC chicken Glenn bought in July

Accepted Answer

The answer of Which of the following would be included...

Question 6

Which of the following actions would be unlikely to increase GDP? &#160;&#10;A)&#160;Tom's alarm clock breaks, so he buys a new one.&#160;&#10;B)&#160;Tom buys a second alarm clock because he routinely sleeps through the alarm of his current clock.&#160;&#10;C)&#160;Tom oversleeps in the morning because his alarm clock is broken, causing him to buy a cup of coffee on the way to work because he has no time to make his own at home.&#160;&#10;D)&#160;Tom's alarm clock breaks, which leads to him being unemployed because he gets fired from his job for being late to work so often.

Accepted Answer

The answer of Which of the following actions would be...

Question 7

In a simple circular-flow diagram, how are total income and total expenditure related? &#160;&#10;A)&#160;They are seldom equal because of the dynamic changes that occur in an economy.&#160;&#10;B)&#160;They are equal only when all goods and services produced are sold.&#160;&#10;C)&#160;They are always equal because every transaction has a buyer and a seller.&#160;&#10;D)&#160;They are always equal because of accounting rules.

Accepted Answer

The answer of In a simple circular-flow diagram, how are...

Question 8

The Lee family won a $50 million jackpot and made several major purchases.Which of their purchases would be counted as investment when calculating GDP by the expenditure approach? &#160;&#10;A)&#160;the villa they just built in the Swiss Alps for $2 million&#160;&#10;B)&#160;the second-hand yacht they purchased for $1 million and expect to sell for a profit before year's end&#160;&#10;C)&#160;the vintage Rolls Royce car they purchased in London for $500,000&#160;&#10;D)&#160;the new house they built in Calgary for $200,000 to serve as living quarters for their ten new servants

Accepted Answer

The answer of The Lee family won a $50 million...

Question 9

Which of the following would be included in GDP? &#160;&#10;A)&#160;payment of the monthly telephone bill by Mr. Laconic&#160;&#10;B)&#160;the purchase of corporate stock by Steven Jones&#160;&#10;C)&#160;the purchase of a used limousine by Harold Abel&#160;&#10;D)&#160;the value of a pair of mittens Hilda Meier's mother knitted for her

Accepted Answer

The answer of Which of the following would be included...

Question 10

Rhonda sells a house she has owned for 15 years.To make it more marketable, she buys carpeting and has it professionally installed, and she buys wallpaper that her daughter hangs.Which of these items would be included in this year's GDP?

A) the sale price of the house, carpeting, and wallpaper; and the installation fee for the carpet
B) the sale price of the house, carpeting, and wallpaper; the installation fee for the carpet; and the opportunity cost of Rhonda's daughter's time
C) the sale price of the house, carpeting, and wallpaper; the installation fee for the carpet; and the opportunity cost of Rhonda's time
D) the sale price of the wallpaper and carpeting; and the installation fee for the carpet

Accepted Answer

The answer of Rhonda sells a house she has owned...

Question 11

How are intermediate goods accounted for when calculating GDP? &#160;&#10;A)&#160;The value of all intermediate goods is included in GDP.&#160;&#10;B)&#160;The value of intermediate goods is included in GDP only if they were produced in the previous year.&#160;&#10;C)&#160;The value of intermediate goods is included in GDP only if they are purchased by firms rather than by households.&#160;&#10;D)&#160;The value of intermediate goods is included in GDP only if they are part of inventory.

Accepted Answer

The answer of How are intermediate goods accounted for when...

Question 12

Which of the following would NOT be an expenditure on a final good or service? &#160;&#10;A)&#160;a medical clinic's purchase of flu vaccines&#160;&#10;B)&#160;a factory's purchase of a spot welding machine&#160;&#10;C)&#160;a customer's purchase of a cup of coffee at a restaurant&#160;&#10;D)&#160;a college student's purchase of a textbook for a medieval history class

Accepted Answer

The answer of Which of the following would NOT be...

Question 13

Which concept is the basis of the national income accounting system? &#160;&#10;A)&#160;the triangular flow of output and income through different sectors of the economy&#160;&#10;B)&#160;the absolute advantage of national trade flows&#160;&#10;C)&#160;the comparative advantage of crucial national industries&#160;&#10;D)&#160;the circular flow of output and income through different sectors of the economy

Accepted Answer

The answer of Which concept is the basis of the...

Question 14

Which of the following would be included in GDP as a form of consumption spending? &#160;&#10;A)&#160;Ann takes Tim out to a restaurant for dinner.&#160;&#10;B)&#160;Ann does gardening at home.&#160;&#10;C)&#160;Ann pays a $200 repair bill in cash, in order to avoid paying HST.&#160;&#10;D)&#160;Ann prepares Tim's income tax return and in return Tim mows her lawn.

Accepted Answer

The answer of Which of the following would be included...

Question 15

Which of the following is the best indicator of the performance of the national economy? &#160;&#10;A)&#160;the stock of capital goods in the nation&#160;&#10;B)&#160;the size of the nation's stock of money&#160;&#10;C)&#160;the balance of trade with other nations&#160;&#10;D)&#160;the flow of new goods and services produced in the nation

Accepted Answer

The answer of Which of the following is the best...

Question 16

Which of the following expenditures is NOT included in the consumption component of GDP? &#160;&#10;A)&#160;maid service&#160;&#10;B)&#160;purchase of a new home&#160;&#10;C)&#160;a restaurant meal&#160;&#10;D)&#160;tax preparation service

Accepted Answer

The answer of Which of the following expenditures is NOT...

Question 17

Why does gross domestic product NOT include intermediate goods? &#160;&#10;A)&#160;because intermediate goods are NOT part of investment spending&#160;&#10;B)&#160;because the value of the intermediate goods is already included in the value of the final goods&#160;&#10;C)&#160;because the value of the intermediate goods is already included as inventory investment&#160;&#10;D)&#160;because intermediate goods are NOT part of current production

Accepted Answer

The answer of Why does gross domestic product NOT include...

Question 18

How is the value of housing services included in GDP? &#160;&#10;A)&#160;It is valued as the annual depreciation of the house.&#160;&#10;B)&#160;It is valued as the mortgage payment made on the house.&#160;&#10;C)&#160;It is based on the purchase price of the house in the year it is sold.&#160;&#10;D)&#160;It is based on an estimate of rental value.

Accepted Answer

The answer of How is the value of housing services...

Question 19

What is Canada's gross domestic product equal to? &#160;&#10;A)&#160;the total output of all goods and services produced by resources located in Canada&#160;&#10;B)&#160;the market value of all goods and services produced by resources located in Canada&#160;&#10;C)&#160;the market value of all final goods and services produced by resources located in Canada&#160;&#10;D)&#160;the value added to the Canadian economy by intermediate goods and services minus original cost

Accepted Answer

The answer of What is Canada's gross domestic product equal...

Question 20

What does gross domestic product measure? &#160;&#10;A)&#160;the market value of all final goods and services produced by a nation's citizens, residents, and firms regardless of the location of production&#160;&#10;B)&#160;the market value of all final goods and services produced by resources located within a nation regardless of who owns those resources&#160;&#10;C)&#160;the market value of all goods and services produced by resources located within a nation regardless of who owns those resources&#160;&#10;D)&#160;the market value of all goods and services produced by a nation's citizens, residents and firms regardless of the location of production

Accepted Answer

The answer of What does gross domestic product measure? &#160;&#10;A)&#160;the...

Question 21

Which of the following would directly reduce GDP? &#160;&#10;A)&#160;An unscrupulous disposal company dumps barrels of toxic waste near a suburban water supply.&#160;&#10;B)&#160;The switch from home-cooked meals to restaurant meals lowers the nutritional value of the average diet.&#160;&#10;C)&#160;The town of Council Bluffs decides to fire the lifeguards at the local swimming pool.&#160;&#10;D)&#160;Pollution of international waters increases.

Accepted Answer

The answer of Which of the following would directly reduce...

Question 22

Which of the following is NOT considered a component of government purchases in calculating GDP? &#160;&#10;A)&#160;the cost of a new federal prison&#160;&#10;B)&#160;the cost of building a new road&#160;&#10;C)&#160;unemployment insurance payments&#160;&#10;D)&#160;the cost of plowing public roads after a snowstorm

Accepted Answer

The answer of Which of the following is NOT considered...

Question 23

In GDP measurement, which of the following would be considered investment spending? &#160;&#10;A)&#160;spending by individual households on automobiles and durable goods&#160;&#10;B)&#160;spending by businesses on labour resources&#160;&#10;C)&#160;spending by businesses on inventories&#160;&#10;D)&#160;spending by government on salaries

Accepted Answer

The answer of In GDP measurement, which of the following...

Question 24

Which of the following is NOT considered a component of investment when calculating GDP? &#160;&#10;A)&#160;new residential construction&#160;&#10;B)&#160;construction of new factories&#160;&#10;C)&#160;net increases in inventory&#160;&#10;D)&#160;purchases of corporate stock

Accepted Answer

The answer of Which of the following is NOT considered...

Question 25

How is the value of net exports calculated? &#160;&#10;A)&#160;exports minus the value of imports&#160;&#10;B)&#160;imports minus the value of exports&#160;&#10;C)&#160;imports minus tariffs&#160;&#10;D)&#160;exports minus tariffs

Accepted Answer

The answer of How is the value of net exports...

Question 26

Suppose exports total $6.5 billion and imports total $8 billion in a year.What do imports and exports together add to GDP? &#160;&#10;A)&#160;$6.5 billion&#160;&#10;B)&#160;$1.5 billion&#160;&#10;C)&#160;-$1.5 billion&#160;&#10;D)&#160;-$8 billion

Accepted Answer

The answer of Suppose exports total $6.5 billion and imports...

Question 27

In GDP measurement, which of the following would be included as consumer spending? &#160;&#10;A)&#160;spending by businesses on labour resources&#160;&#10;B)&#160;spending by government on office buildings&#160;&#10;C)&#160;spending by individual households on automobiles and durables&#160;&#10;D)&#160;spending by business on inventories

Accepted Answer

The answer of In GDP measurement, which of the following...

Question 28

Which of the following is included in GDP as government purchases? &#160;&#10;A)&#160;Old Age Security pension paid to elderly citizens&#160;&#10;B)&#160;welfare benefits distributed to the poor&#160;&#10;C)&#160;outright grants from government to recipients&#160;&#10;D)&#160;payments to clerical workers hired by government

Accepted Answer

The answer of Which of the following is included in...

Question 29

Which of the following would NOT be included in GDP as government purchases? &#160;&#10;A)&#160;The local township repairs the roads.&#160;&#10;B)&#160;The government sends out welfare cheques.&#160;&#10;C)&#160;The government pays a lawyer as a public defender.&#160;&#10;D)&#160;The government buys computer time.

Accepted Answer

The answer of Which of the following would NOT be...

Question 30

Which of the following describes how imports affect Canadian GDP? &#160;&#10;A)&#160;Imports are NOT added to Canadian GDP because they are produced abroad.&#160;&#10;B)&#160;Imports are added to Canadian GDP because they are consumed domestically.&#160;&#10;C)&#160;Imports are added to Canadian GDP because they represent an increase in inventories.&#160;&#10;D)&#160;Imports are NOT added to Canadian GDP because they are intermediate goods.

Accepted Answer

The answer of Which of the following describes how imports...

Question 31

Which of the following would be included as consumption in the expenditures approach to calculating GDP? &#160;&#10;A)&#160;spending by businesses on a plant and equipment&#160;&#10;B)&#160;spending by government on office buildings&#160;&#10;C)&#160;spending by households on new single-family houses&#160;&#10;D)&#160;purchases of dental services by patients

Accepted Answer

The answer of Which of the following would be included...

Question 32

Which of the following would NOT be included in an economist's definition of investment spending? &#160;&#10;A)&#160;the purchase of robots by Motor Magic Manufacturing&#160;&#10;B)&#160;the construction of a new office building by the Mountain City Real Estate Company&#160;&#10;C)&#160;the purchase of Bombardier stock by a pension fund&#160;&#10;D)&#160;the purchase of a new pizza oven by H and R Pizza

Accepted Answer

The answer of Which of the following would NOT be...

Question 33

Which of the following is NOT included in GDP? &#160;&#10;A)&#160;the cost of restoring an old painting&#160;&#10;B)&#160;interest payments on the national debt&#160;&#10;C)&#160;the cost of a new vending machine&#160;&#10;D)&#160;government expenditure on a new bridge

Accepted Answer

The answer of Which of the following is NOT included...

Question 34

Which of the following is the best example of an investment as defined by economists? &#160;&#10;A)&#160;a household's purchase of 100 shares of Apple computer stock&#160;&#10;B)&#160;a firm's purchase of 100 shares of General Electric stock&#160;&#10;C)&#160;a firm's purchase of a bond issued by General Mills&#160;&#10;D)&#160;a firm purchases computers for its office staff

Accepted Answer

The answer of Which of the following is the best...

Question 35

Suppose a toy store overestimated the demand for a toy in 2014 and, as a result, had an unexpectedly large number of them on hand at the end of that year.How was the value of the increased inventory of those toys counted?

A) as investment in 2014
B) as investment in 2015
C) as consumption in 2014
D) as consumption in 2015

Accepted Answer

The answer of Suppose a toy store overestimated the demand...

Question 36

What is the immediate effect on GDP of Ibrahim's purchase of a government bond? &#160;&#10;A)&#160;Consumption will decrease because Ibrahim has less money to spend.&#160;&#10;B)&#160;Government spending will increase because governments will need to spend more.&#160;&#10;C)&#160;Investment will increase because the purchase of a bond is a form of economic investment.&#160;&#10;D)&#160;There will be no effect, because no real goods and services have been produced.

Accepted Answer

The answer of What is the immediate effect on GDP...

Question 37

Suppose that storage costs increase, so that firms decide to hold less output in inventory, other things constant.Which expenditure category does this affect? &#160;&#10;A)&#160;Consumption spending will increase.&#160;&#10;B)&#160;Consumption spending will decrease.&#160;&#10;C)&#160;Investment will increase.&#160;&#10;D)&#160;Investment will decrease.

Accepted Answer

The answer of Suppose that storage costs increase, so that...

Question 38

Which of the following statements reflects how exports and imports affect GDP? &#160;&#10;A)&#160;Both imports and exports are added to a nation's GDP.&#160;&#10;B)&#160;Both imports and exports are subtracted from a nation's GDP.&#160;&#10;C)&#160;Imports are added to a nation's GDP; exports are subtracted.&#160;&#10;D)&#160;Exports are added to a nation's GDP; imports are subtracted.

Accepted Answer

The answer of Which of the following statements reflects how...

Question 39

Which of the following describes how Canadian exports affect Canadian GDP? &#160;&#10;A)&#160;Canadian exports are NOT included in Canadian GDP because they are consumed abroad.&#160;&#10;B)&#160;Canadian exports are included in Canadian GDP because they are produced domestically.&#160;&#10;C)&#160;Canadian exports are included in Canadian GDP because they represent an increase in inventories.&#160;&#10;D)&#160;Canadian exports are NOT included in Canadian GDP because they are NOT subject to a tariff.

Accepted Answer

The answer of Which of the following describes how Canadian...

Question 40

Which of the following would NOT be counted in this year's GDP? &#160;&#10;A)&#160;Midwest Tractor Company's inventory of brand new farm equipment, which will remain unsold by year's end&#160;&#10;B)&#160;Bruno's meal at the local La Casa Caliente restaurant&#160;&#10;C)&#160;the new house the Barnaby family had constructed this year&#160;&#10;D)&#160;the vacation that the Cartier family enjoyed in France this winter

Accepted Answer

The answer of Which of the following would NOT be...

Question 41

What is the ultimate goal of studying the circular-flow model? &#160;&#10;A)&#160;to understand the flow of money through the market system&#160;&#10;B)&#160;to understand the flow of consumer spending through the economy&#160;&#10;C)&#160;to understand the flow of goods and services through the product market&#160;&#10;D)&#160;to understand the flow of resources, goods, and money through the economy

Accepted Answer

The answer of What is the ultimate goal of studying...

Question 42

What does double counting in the value-added approach to GDP refer to? &#160;&#10;A)&#160;corporate income being taxed twice&#160;&#10;B)&#160;calculating GDP twice using the income method and the expenditure method&#160;&#10;C)&#160;adding the value of exports to GDP and subtracting the value of imports&#160;&#10;D)&#160;counting the total value of a final output in addition to the value of the inputs used to make it

Accepted Answer

The answer of What does double counting in the value-added...

Question 43

What is the definition of value added? &#160;&#10;A)&#160;the sum of all income earned by resource suppliers&#160;&#10;B)&#160;actual investment minus planned investment&#160;&#10;C)&#160;any payment of income that adds to the domestic spending stream&#160;&#10;D)&#160;the value of a product minus the cost of materials

Accepted Answer

The answer of What is the definition of value added?...

Question 44

$$\begin{array} { | l | l | } &#10;\hline \text { Consumption } & \$ 2,000 \&#10;\hline \text { Gross investment } & \$ 600 \&#10;\hline \text { Government purchases } & \$ 500 \&#10;\hline \text { Net exports } & - \$ 40 \&#10;\hline \text { Transfer payments } & \$ 340 \&#10;\hline&#10;\end{array}$$&#10;&#10;-Refer to the data in the exhibit.What is GDP? &#160;&#10;A)&#160;$3,140&#160;&#10;B)&#160;$6,220&#160;&#10;C)&#160;$6,560&#160;&#10;D)&#160;$6,900

Accepted Answer

The answer of \[\begin{array} { | l | l |...

Question 45

$$\begin{array} { c c c c } &#10;\hline \begin{array} { c } &#10;\text { Real GDP } \&#10;( \$ )&#10;\end{array} & \begin{array} { c } &#10;\text { Consumption } \&#10;( \$ )&#10;\end{array} & \begin{array} { c } &#10;\text { Planned } \&#10;\text { investment } \&#10;( \$ )&#10;\end{array} & \begin{array} { c } &#10;\text { Government } \&#10;\text { purchases } \&#10;( \$ )&#10;\end{array} \&#10;\hline 1,800 & 1,540 & 100 & 200 \&#10;1,900 & 1,620 & 100 & 200 \&#10;2,000 & 1,700 & 100 & 200 \&#10;2,100 & 1,780 & 100 & 200 \&#10;2,200 & 1,860 & 100 & 200 \&#10;2,300 & 1,940 & 100 & 200 \&#10;\hline&#10;\end{array}$$&#10;&#10;-Refer to the data in the exhibit.What is aggregate expenditure? &#160;&#10;A)&#160;$1,800&#160;&#10;B)&#160;$1,900&#160;&#10;C)&#160;$2,000&#160;&#10;D)&#160;$2,200

Accepted Answer

The answer of \[\begin{array} { c c c c }...

Question 46

Which of the following would NOT increase Canadian GDP? &#160;&#10;A)&#160;increased demand in Costa Rica for Canadian-made personal computers&#160;&#10;B)&#160;increased demand in Alberta for Canadian-made personal computers&#160;&#10;C)&#160;increased shipments of computers from Canada to the United States&#160;&#10;D)&#160;increased shipments of Ghanaian cocoa to Canada on Greek vessels

Accepted Answer

The answer of Which of the following would NOT increase...

Question 47

Katrina pays $40 for a meal at a fancy restaurant.The meal's ingredients probably cost the restaurant $10.What is the value added to GDP by the purchase of this meal? &#160;&#10;A)&#160;$10&#160;&#10;B)&#160;$30&#160;&#10;C)&#160;$40&#160;&#10;D)&#160;$50

Accepted Answer

The answer of Katrina pays $40 for a meal at...

Question 48

When a refrigerator worth $1,000 is produced and sold, its contribution to the GDP is measured on the expenditure side by its sale price.How is the refrigerator's contribution to the GDP measured on the income side?

A) according to the wages earned by the workers and the profits earned by the owners of the firm that produced the refrigerator
B) according to wages, interest, and rent paid by the firm's owners to those who contributed to making the refrigerator
C) according to wages, interest, and rent paid by the firm's owners to those who contributed to making the refrigerator, less taxes
D) according to wages, interest, and rent paid by the firm's owners to those who contributed to making the refrigerator, plus the profit the owners kept for themselves

Accepted Answer

The answer of When a refrigerator worth $1,000 is produced...

Question 49

A farmer grows wheat and sells it to a bakery for $5.The bakery bakes the wheat into bread, which it sells to a distributor for $20.The distributor sells the bread to a supermarket for $30, which sells the bread to customers for $50.At which stage was the most value added?

A) at the farming stage
B) at the bakery stage
C) at the distributor stage
D) at the supermarket stage

Accepted Answer

The answer of A farmer grows wheat and sells it...

Question 50

If an economy produces final output worth $5 trillion, then what is the amount of gross income generated by that production? &#160;&#10;A)&#160;$5 trillion minus taxes&#160;&#10;B)&#160;$5 trillion&#160;&#10;C)&#160;$5 trillion if profits were zero&#160;&#10;D)&#160;more than $5 trillion

Accepted Answer

The answer of If an economy produces final output worth...

Question 51

How is double counting in the value-added approach to GDP statistics avoided? &#160;&#10;A)&#160;by correct accounting of the values of exports and imports&#160;&#10;B)&#160;by choosing only one method to calculate GDP&#160;&#10;C)&#160;by counting only the value added at each stage of a good's production process&#160;&#10;D)&#160;by counting the value of final and intermediate goods and services

Accepted Answer

The answer of How is double counting in the value-added...

Question 52

A wholesale nursery purchases six dozen gladiolus bulbs for $5.The nursery sells the six dozen resulting flowers to a wholesale florist for $10.The wholesale florist delivers the flowers to a retail florist for $15.The flowers are sold by the retail florist for $75 to the bereaved Jones family to use at great-grandfather Jones's wake.What is the value added by the retail florist? &#160;&#10;A)&#160;$15&#160;&#10;B)&#160;$25&#160;&#10;C)&#160;$60&#160;&#10;D)&#160;$75

Accepted Answer

The answer of A wholesale nursery purchases six dozen gladiolus...

Question 53

Which of the following is NOT a component of aggregate expenditure? &#160;&#10;A)&#160;consumption&#160;&#10;B)&#160;investment&#160;&#10;C)&#160;imports&#160;&#10;D)&#160;rent

Accepted Answer

The answer of Which of the following is NOT a...

Question 54

What is the largest component of aggregate expenditure? &#160;&#10;A)&#160;government purchases&#160;&#10;B)&#160;imports&#160;&#10;C)&#160;consumption&#160;&#10;D)&#160;investment

Accepted Answer

The answer of What is the largest component of aggregate...

Question 55

Which of the following describes the final market value of a good? &#160;&#10;A)&#160;It is the sum of values added at all stages of production.&#160;&#10;B)&#160;It is the value added at one stage of production.&#160;&#10;C)&#160;It is greater than the sum of all the values added at all stages of production.&#160;&#10;D)&#160;It is less than the sum of all the values added at all stages of production.

Accepted Answer

The answer of Which of the following describes the final...

Question 56

$$\begin{array} { | l | l | } &#10;\hline \text { Consumption } & \$ 2,000 \&#10;\hline \text { Gross investment } & \$ 600 \&#10;\hline \text { Government purchases } & \$ 500 \&#10;\hline \text { Net exports } & - \$ 40 \&#10;\hline \text { Transfer payments } & \$ 340 \&#10;\hline&#10;\end{array}$$&#10;&#10;-Refer to the data in the exhibit.What is GDP? &#160;&#10;A)&#160;$2,720&#160;&#10;B)&#160;$3,060&#160;&#10;C)&#160;$3,140&#160;&#10;D)&#160;$3,400

Accepted Answer

The answer of \[\begin{array} { | l | l |...

Question 57

Ann's Adventures, Inc.organizes and leads backpacking trips for $160 per person.Ann's Adventures spends $30 per person on first aid equipment and $10 per person on maps.What is the amount of value added to GDP? &#160;&#10;A)&#160;$200 of backpacking trips, $30 of first aid equipment, and $10 of maps&#160;&#10;B)&#160;$160 of backpacking trips, $30 of first aid equipment, and $10 of maps&#160;&#10;C)&#160;$160 of backpacking trips&#160;&#10;D)&#160;$120 of backpacking trips

Accepted Answer

The answer of Ann's Adventures, Inc.organizes and leads backpacking trips...

Question 58

What is the definition of aggregate income? &#160;&#10;A)&#160;the sum of income earned by all labourers in the world economy&#160;&#10;B)&#160;the sum of income earned by all workers in the private sector&#160;&#10;C)&#160;the total income of all individuals who contribute resources to the market production of output&#160;&#10;D)&#160;total income after all income taxes but before paying other payroll taxes

Accepted Answer

The answer of What is the definition of aggregate income?...

Question 59

Jimmy Earl, a farmer, sells $20 worth of peanuts to a factory that turns them into peanut butter, which is then sold for $45.In terms of computing GDP, what is the total value added? &#160;&#10;A)&#160;$20&#160;&#10;B)&#160;$25&#160;&#10;C)&#160;$45&#160;&#10;D)&#160;$65

Accepted Answer

The answer of Jimmy Earl, a farmer, sells $20 worth...

Question 60

Which of the following is NOT a component of aggregate expenditure? &#160;&#10;A)&#160;exports&#160;&#10;B)&#160;investment&#160;&#10;C)&#160;transfer payments&#160;&#10;D)&#160;government purchases

Accepted Answer

The answer of Which of the following is NOT a...

Question 61

Which of the following is a leakage from the circular flow? &#160;&#10;A)&#160;investment&#160;&#10;B)&#160;imports&#160;&#10;C)&#160;government purchases&#160;&#10;D)&#160;government borrowing

Accepted Answer

The answer of Which of the following is a leakage...

Question 62

Suppose that the economy is in equilibrium, with the government budget in deficit and with saving less than investment.According to the circular-flow model, how do imports relate to exports? &#160;&#10;A)&#160;Imports must exceed exports.&#160;&#10;B)&#160;Imports must be less than exports.&#160;&#10;C)&#160;Imports must equal exports.&#160;&#10;D)&#160;Imports could be less than or equal to exports.

Accepted Answer

The answer of Suppose that the economy is in equilibrium,...

Question 63

Suppose that the economy is in equilibrium, with the government budget in surplus and with exports less than imports.According to the circular-flow model, how does saving relate to investment? &#160;&#10;A)&#160;Saving must exceed investment.&#160;&#10;B)&#160;Saving must be less than investment.&#160;&#10;C)&#160;Saving must equal investment.&#160;&#10;D)&#160;Saving could be greater than or equal to investment.

Accepted Answer

The answer of Suppose that the economy is in equilibrium,...

Question 64

Suppose that the economy is in equilibrium, with the government budget in surplus and with saving greater than investment.According to the circular-flow model, how do imports relate to exports? &#160;&#10;A)&#160;Imports must exceed exports.&#160;&#10;B)&#160;Imports must be less than exports.&#160;&#10;C)&#160;Imports must equal exports.&#160;&#10;D)&#160;Imports could be greater than or equal to exports.

Accepted Answer

The answer of Suppose that the economy is in equilibrium,...

Deck 6: Tracking the Canadian Economy