Question 1

In 1820 the country with the highest per capita GDP was ______________________. In 1900 the country that ranked #1 in terms of per capita GDP was ___________________ and fifty years later the top ranking was held by _________________________.

Accepted Answer

A) the Netherlands; New Zealand; the United States. 
B) the Netherlands; Australia; Switzerland. 
C) the United States; the United States; the United States. 
D) Austria; Australia; New Zealand.

Question 2

The sale of __________ goods is omitted from current GDP because __________.

Accepted Answer

A) intermediate goods; these goods do not constitute production 
B) used goods; these goods were counted in an earlier year 
C) illegal; these goods do not constitute economic value 
D) b and c 
E) a, b, and c

Question 3

Look at the following data: GDP = $3,590 billion; consumption = $1,820 billion; exports = $450 billion; investment = $1,250 billion; government purchases = $900 billion. Imports is equal to __________ billion.

Accepted Answer

A) $830 
B) $1,460 
C) -$830 
D) $1,240 
E) none of the above

Question 4

The standard definition of "recession" is

Accepted Answer

A) a period of a positive frictional unemployment rate. 
B) two consecutive quarters of falling Real GDP. 
C) the lowest point in a business cycle. 
D) a period of negative inflation.

Question 5

You have data for compensation of employees, proprietors' income, rental income, and net interest. Can you compute national income?

Accepted Answer

A) Yes, all of the components of national income are given. 
B) No, since data on indirect business taxes are missing. 
C) No, since data on corporate profits is missing. 
D) No, since data on the capital consumption allowance is missing. 
E) No, since net interest has not been adjusted for profits.

Question 6

An example of income earned but not received is corporate dividends.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following statements is true?

Accepted Answer

A) Another name for capital consumption allowance is depreciation. 
B) When there are two consecutive quarterly declines in Real GDP the economy is said to be in recession (based on the standard definition). 
C) In the expansion phase of a business cycle, Real GDP rises beyond the recovery. 
D) a and b 
E) a, b, and c

Question 8

Exhibit 7-3
 
-Refer to Exhibit 7-3. GDP is equal to

Accepted Answer

A) $13,050. 
B) $11,550. 
C) $8,600. 
D) $11,450. 
E) $14,000.

Question 9

In the business cycle, what is the difference between the recovery phase and the expansion phase?

Accepted Answer

A) The expansion phase occurs in the rising portion of the business cycle, while the recovery phase occurs in the falling portion of the business cycle. 
B) The expansion phase occurs in the falling portion of the business cycle, while the recovery phase occurs in the rising portion of the business cycle. 
C) The expansion phase is the period when Real GDP increases beyond the recovery phase. 
D) The expansion phase must always come before the recovery phase.

Question 10

Look at the following data: consumption = $925 billion; exports = $50 billion; imports = $62 billion; investment = $325 billion; government purchases = $300 billion. GDP is equal to __________ billion.

Accepted Answer

A) $1,662 
B) $1,468 
C) $1,911 
D) $1,538 
E) none of the above

Question 11

The expenditure approach to measuring GDP sums

Accepted Answer

A) consumption, investment, government purchases, and net exports. 
B) sales, revenues, income, and wages. 
C) profits, compensation of employees, consumption, and investment. 
D) net exports, consumption, wages, and salaries. 
E) consumption, interest, net exports, and federal government purchases

Question 12

The expenditure approach to computing GDP measures

Accepted Answer

A) U.S.spending on all goods. 
B) U.S.spending on only U.S.goods. 
C) U.S.and foreign spending on only U.S.goods 
D) only foreign spending on foreign goods.

Question 13

Exhibit 7-1
 
-Refer to Exhibit 7-1. Which of the following summations represents net domestic product?

Accepted Answer

A) GDP - $222 
B) GDP - $331 
C) GDP - $412 
D) GDP - $295 
E) GDP + $134

Question 14

In which phase of the business cycle does a recession occur?

Accepted Answer

A) contraction 
B) peak 
C) recovery 
D) expansion

Question 15

Exhibit 7-2
 
-Refer to Exhibit 7-2. GDP in 1990 is

Accepted Answer

A) $49. 
B) $51. 
C) $86. 
D) $92. 
E) impossible to calculate without the CPI.

Question 16

Exhibit 7-1
 
-Refer to Exhibit 7-1. Which of the following summations represents GDP using the expenditure approach?

Accepted Answer

A) $4,150 + $751 + $850 + $300 
B) $4,150 + $751 + $850 - $331 + $300 
C) $4,150 + $751 + $850 + $331 + $300 
D) $4,150 + $751 + $850 + $331 + $300 - $320 
E) $4,150 + $751 + $850 + $331 + $300 - $320 + $111

Question 17

An example of income received but not earned is

Accepted Answer

A) government transfer payments. 
B) undistributed profits. 
C) compensation of employees. 
D) rental income. 
E) a and c

Question 18

GDP can rise as a result of a rise in __________________, and Real GDP can rise as a result of a rise in _______________________.

Accepted Answer

A) prices or output; prices only. 
B) prices only; prices or output. 
C) prices or output; output only. 
D) prices or output; prices or output.

Question 19

Exhibit 7-2
 
-Refer to Exhibit 7-2. GDP in 2019 is

Accepted Answer

A) $49. 
B) $51. 
C) $86. 
D) $92. 
E) not possible to calculate without the CPI.

Question 20

Which of the following statements is false?

Accepted Answer

A) The market value of all nonmarket goods is omitted from GDP. 
B) The sale of used goods is omitted from GDP. 
C) The market value of a person mowing his or her own lawn is omitted from GDP. 
D) If a good is produced but not sold, it is included in GDP.

Exam 7: Macroeconomic Measurements Part II Gdp and Real Gdp

In 1820 the country with the highest per capita GDP was ____________. In 1900 the country that ranked #1 in terms of per capita GDP was _ and fifty years later the top ranking was held by _________________.

The sale of goods is omitted from current GDP because .

Look at the following data: GDP = $3,590 billion; consumption = $1,820 billion; exports = $450 billion; investment = $1,250 billion; government purchases = $900 billion. Imports is equal to __________ billion.

The standard definition of "recession" is

You have data for compensation of employees, proprietors' income, rental income, and net interest. Can you compute national income?

An example of income earned but not received is corporate dividends.

Which of the following statements is true?

Exhibit 7-3 -Refer to Exhibit 7-3. GDP is equal to

In the business cycle, what is the difference between the recovery phase and the expansion phase?

Look at the following data: consumption = $925 billion; exports = $50 billion; imports = $62 billion; investment = $325 billion; government purchases = $300 billion. GDP is equal to __________ billion.

The expenditure approach to measuring GDP sums

The expenditure approach to computing GDP measures

Exhibit 7-1 -Refer to Exhibit 7-1. Which of the following summations represents net domestic product?

In which phase of the business cycle does a recession occur?

Exhibit 7-2 -Refer to Exhibit 7-2. GDP in 1990 is

Exhibit 7-1 -Refer to Exhibit 7-1. Which of the following summations represents GDP using the expenditure approach?

An example of income received but not earned is

GDP can rise as a result of a rise in , and Real GDP can rise as a result of a rise in _____.

Exhibit 7-2 -Refer to Exhibit 7-2. GDP in 2019 is

Which of the following statements is false?