Question 1

In a given year,a country's GDP = $3843,net factor payments from abroad = $191,taxes = $893,transfers received from the government = $422,interest payments on the government's debt = $366,consumption = $3661,and government purchases = $338.Calculate the values of private saving,government saving,and national saving.

Accepted Answer

The answer of In a given year,a country's GDP =...

Question 2

Pete the Pizza Man produced $87,000 worth of pizzas in the past year.He paid $39,000 to employees,paid $11,000 for vegetables and other ingredients,and paid $5000 in taxes.He began the year with ingredient inventories valued at $1000,and ended the year with inventories valued at $2000.What was Pete's (and his employees')total contribution to GDP this year?

Accepted Answer

The answer of Pete the Pizza Man produced $87,000 worth...

Question 3

One problem with using market values to measure GDP is that

Accepted Answer

A) you cannot compare completely heterogeneous goods by using their dollar values. 
B) some useful goods and services are not sold in markets. 
C) prices for some goods change every year. 
D) market values of exported goods are usually priced in foreign currencies.

Question 4

The Boskin Commission concluded that the CPI overstates increases in the cost of living by ________ percentage point(s)per year.

Accepted Answer

A) Less than 1 
B) 1 to 2 
C) About 3 
D) Over 4

Question 5

Saving is a ________ variable,and wealth is a ________ variable.

Accepted Answer

A) stock; flow 
B) stock; stock 
C) flow; flow 
D) flow; stock

Question 6

The country of Old Jersey produces milk and butter,and it has published the following macroeconomic data,where quantities are in gallons and prices are dollars per gallon. 
Between Year 1 and Year 2,the percent change in real GDP (based on Year 1 as a base year)was

Accepted Answer

A) 58%. 
B) 60%. 
C) 130%. 
D) 190%.

Question 7

Government statisticians adjust GDP figures to include estimates of

Accepted Answer

A) the value of homemaking (work done within the home). 
B) the underground economy. 
C) child-rearing services provided by stay-at-home parents. 
D) the costs of pollution to society.

Question 8

The country of Myrule has produced the following quantity of gauges and potatoes,with the price of each listed in dollar terms.
  
(a)Using Year 1 as the base year,what is the growth rate of real GDP from Year 1 to Year 2?
(b)Based on the GDP deflator,what is the inflation rate from Year 1 to Year 2?

Accepted Answer

The answer of The country of Myrule has produced the...

Question 9

Nominal GDP in a country was $8759.9 billion in 2014 and $9254.6 billion in 2015.The GDP deflator was 102.86 for 2014 and 104.37 for 2015.
(a)What is the growth rate of nominal GDP between 2014 and 2015?
(b)What is the inflation rate from 2014 to 2015?
(c)What is the growth rate of real GDP from 2014 to 2015?

Accepted Answer

The answer of Nominal GDP in a country was $8759.9...

Question 10

If the price index last year was 1.0 and today it is 1.4,what is the inflation rate over this period?

Accepted Answer

A) -4% 
B) 1)4% 
C) 4% 
D) 40%

Question 11

National income equals

Accepted Answer

A) net national product minus statistical discrepancy. 
B) gross national product minus depreciation. 
C) GNP minus depreciation and taxes on production and imports. 
D) net national product minus taxes on production and imports and employer contributions to Social Security.

Question 12

In the mid- to late 1980s,the United States had "twin deficits" because both ________ and ________ were negative.

Accepted Answer

A) government saving; private saving 
B) saving; investment 
C) the current account; investment 
D) government saving; the current account

Question 13

The equation total production = total income = total expenditure is called

Accepted Answer

A) the goods-market equilibrium condition. 
B) the total identity. 
C) the fundamental identity of national income accounting. 
D) Say's Law.

Question 14

The nominal interest rate is 7%,today's price level is 150,and you expect the price level to be 156 one year from now.What is the expected inflation rate? What is the expected real interest rate?

Accepted Answer

The answer of The nominal interest rate is 7%,today's price...

Question 15

Business fixed investment includes purchases of

Accepted Answer

A) capital equipment and structures. 
B) land and energy. 
C) long-term bonds. 
D) inventories.

Question 16

In a given year,a country's GDP = $9841,net factor payments from abroad = $889,taxes = $869,transfers received from the government = $296,interest payments on the government's debt = $103,consumption = $8148,and government purchases = $185.The country had private saving equal to

Accepted Answer

A) $285. 
B) $3850. 
C) $2397. 
D) $2112.

Question 17

Two years ago,the GDP deflator for Old York was 300,and today it is 330.75.Based on this information the annual average inflation rate for the two years was

Accepted Answer

A) 5%. 
B) 5)125%. 
C) 10%. 
D) 10.25%.

Question 18

Which of the following is not a category of consumption spending in the national income accounts?

Accepted Answer

A) Consumer durables 
B) Nondurable goods 
C) Services 
D) Housing purchases

Question 19

By how much does the CPI overstate true increases in the cost of living,according to the Boskin Commission? What are the main reasons for this bias in the CPI? What are the economic implications of the bias?

Accepted Answer

The answer of By how much does the CPI overstate...

Question 20

If nominal GDP for 2009 is $6400 billion and real GDP for 2010 is $6720 billion (in 2009 dollars),then the growth rate of real GDP is

Accepted Answer

A) 0%. 
B) 0)5%. 
C) 5%. 
D) 50%.

Exam 2: The Measurement and Structure of the National Economy

One problem with using market values to measure GDP is that

The Boskin Commission concluded that the CPI overstates increases in the cost of living by ________ percentage point(s) per year.

Saving is a variable,and wealth is a variable.

The country of Old Jersey produces milk and butter,and it has published the following macroeconomic data,where quantities are in gallons and prices are dollars per gallon. Between Year 1 and Year 2,the percent change in real GDP (based on Year 1 as a base year) was