Question 1

Consumption expenditures include

Accepted Answer

A) expenditures by households on goods and services produced only in the United States. 
B) purchases of consumer goods produced in the United States by households, businesses, government, and other countries. 
C) purchases of consumer goods produced in the United States and the rest of the world by households, businesses, government, and other countries. 
D) expenditures by households on goods and services produced in the United States and the rest of the world. 
E) the purchase of new homes by households. 
A) expenditures by households on goods and services produced only in the United States. 
B) purchases of consumer goods produced in the United States by households, businesses, government, and other countries. 
C) purchases of consumer goods produced in the United States and the rest of the world by households, businesses, government, and other countries. 
D) expenditures by households on goods and services produced in the United States and the rest of the world. 
E) the purchase of new homes by households.

Question 2

Government saving equals

Accepted Answer

A) government purchases of goods and services plus transfer payments less taxes. 
B) taxes less government expenditures. 
C) transfer payments. 
D) taxes. 
E) government purchases of goods and services less taxes. 
A) government purchases of goods and services plus transfer payments less taxes. 
B) taxes less government expenditures. 
C) transfer payments. 
D) taxes. 
E) government purchases of goods and services less taxes.

Question 3

Please answer true or false and explain.

Accepted Answer

The answer of Please answer true or false and explain.
...

Question 4

Exhibit 18-6
   Multiple Choice
-According to the data in Exhibit 18-6, the GDP deflator in 2016 (the base year) was

Accepted Answer

A)  1.28. 
B)  1.25. 
C)  1. 
D)  .8. 
E)  1.30. 
A)  1.28. 
B)  1.25. 
C)  1. 
D)  .8. 
E)  1.30.

Question 5

If IBM manufactures a computer in the United States and sells it to a French business firm in Paris, it will cause an increase in

Accepted Answer

A) net exports. 
B) imports. 
C) both investment and net exports. 
D) government expenditures. 
E) consumption. 
A) net exports. 
B) imports. 
C) both investment and net exports. 
D) government expenditures. 
E) consumption.

Question 6

Exhibit 18-2
  
-Exhibit 18-2 shows the cost of the components used to produce a $550 smartphone. The total value of output that would be recorded in GDP is

Accepted Answer

A) $200. 
B) $360. 
C) $400. 
D) $450. 
E) $550. 
A) $200. 
B) $360. 
C) $400. 
D) $450. 
E) $550.

Question 7

Suppose that investment in the United States was about $130 billion and the trade deficit was $10 billion. How much was national saving in the United States? If the government budget surplus was $2 billion, how much total saving by consumers and businesses in the United States occurred?

Accepted Answer

National saving = investment +

Question 8

Given the information in the table below for three consecutive years in the U.S. economy, calculate the missing data.

Accepted Answer

The answer of Given the information in the table below...

Question 9

Social security payments are included in government purchases.

Accepted Answer

A) True 
 B)False

Question 10

Examine the following data for a hypothetical centrally planned economy that subsequently freezes prices so that they are not allowed to change:

Accepted Answer

The answer of Examine the following data for a hypothetical...

Question 11

When you buy some stock of Google, it is an investment expenditure so it counts toward GDP.

Accepted Answer

A) True 
 B)False

Question 12

A computer dealer has 20 computers at the beginning of the month and receives an additional 35 computers during the month. If the computer dealer has 15 computers in stock at the end of the month, the dealer's inventory investment for that month would be

Accepted Answer

A) minus 15 computers. 
B) plus 5 computers. 
C) minus 5 computers. 
D) plus 15 computers. 
E) plus 35 computers. 
A) minus 15 computers. 
B) plus 5 computers. 
C) minus 5 computers. 
D) plus 15 computers. 
E) plus 35 computers.

Question 13

Value added can be determined by

Accepted Answer

A) subtracting the cost of the intermediate goods from the price of the product at each stage of production. 
B) adding the income of all consumers during the year. 
C) summing the market values of all intermediate goods. 
D) calculating the percentage change in GDP from one year to the next. 
E) dividing GDP by the GDP price deflator. 
A) subtracting the cost of the intermediate goods from the price of the product at each stage of production. 
B) adding the income of all consumers during the year. 
C) summing the market values of all intermediate goods. 
D) calculating the percentage change in GDP from one year to the next. 
E) dividing GDP by the GDP price deflator.

Question 14

You sell your used calculus book to your friend. This transaction, in most cases, will not count in GDP.

Accepted Answer

A) True 
 B)False

Question 15

Other things being equal, a decline in imports will be associated with an increase in GDP.

Accepted Answer

A) True 
 B)False

Question 16

You buy a new TV that was produced last year. This causes consumption expenditure to increase for this year and investment expenditure to decrease by roughly the same amount.

Accepted Answer

A) True 
 B)False

Question 17

Nominal GDP must always grow faster than real GDP.

Accepted Answer

A) True 
 B)False

Question 18

A government incurs a budget deficit when

Accepted Answer

A) imports are greater than exports. 
B) exports are greater than imports. 
C) taxes are greater than government expenditure. 
D) taxes are less than government expenditure. 
E) None of these 
A) imports are greater than exports. 
B) exports are greater than imports. 
C) taxes are greater than government expenditure. 
D) taxes are less than government expenditure. 
E) None of these

Question 19

Which of the following is a stock variable?

Accepted Answer

A) Wealth 
B) Investment 
C) GDP 
D) Savings 
E) Income 
A) Wealth 
B) Investment 
C) GDP 
D) Savings 
E) Income

Question 20

If a computer retailer has 20 computers at the beginning of the month, receives an additional 35 computers during the month, and sells no computers during the month, the retailer's inventory investment for that month would be

Accepted Answer

A) minus 35 computers. 
B) plus 20 computers. 
C) minus 20 computers. 
D) plus 35 computers. 
E) plus 55 computers. 
A) minus 35 computers. 
B) plus 20 computers. 
C) minus 20 computers. 
D) plus 35 computers. 
E) plus 55 computers.

Exam 18: Measuring the Production, Income, and Spending of Nations

Consumption expenditures include

Government saving equals

Please answer true or false and explain.

Exhibit 18-6 Multiple Choice -According to the data in Exhibit 18-6, the GDP deflator in 2016 (the base year) was

If IBM manufactures a computer in the United States and sells it to a French business firm in Paris, it will cause an increase in

Exhibit 18-2 -Exhibit 18-2 shows the cost of the components used to produce a $550 smartphone. The total value of output that would be recorded in GDP is

Suppose that investment in the United States was about $130 billion and the trade deficit was $10 billion. How much was national saving in the United States? If the government budget surplus was $2 billion, how much total saving by consumers and businesses in the United States occurred?

Given the information in the table below for three consecutive years in the U.S. economy, calculate the missing data.

Social security payments are included in government purchases.

Examine the following data for a hypothetical centrally planned economy that subsequently freezes prices so that they are not allowed to change:

When you buy some stock of Google, it is an investment expenditure so it counts toward GDP.

A computer dealer has 20 computers at the beginning of the month and receives an additional 35 computers during the month. If the computer dealer has 15 computers in stock at the end of the month, the dealer's inventory investment for that month would be

Value added can be determined by

You sell your used calculus book to your friend. This transaction, in most cases, will not count in GDP.

Other things being equal, a decline in imports will be associated with an increase in GDP.

You buy a new TV that was produced last year. This causes consumption expenditure to increase for this year and investment expenditure to decrease by roughly the same amount.

Nominal GDP must always grow faster than real GDP.

A government incurs a budget deficit when

Which of the following is a stock variable?

If a computer retailer has 20 computers at the beginning of the month, receives an additional 35 computers during the month, and sells no computers during the month, the retailer's inventory investment for that month would be

The Central Idea

Observing and Explaining the Economy

The Supply and Demand Model

Subtleties of the Supply and Demand Model

The Demand Curve and the Behavior of Consumers

The Supply Curve and the Behavior of Firms

The Efficiency of Markets

Costs and the Changes at Firms Over Time

The Rise and Fall of Industries

Monopoly

Product Differentiation, Monopolistic Competition, and Oligopoly

Antitrust Policy and Regulation

Labor Markets

Taxes, Transfers, and Income Distribution

Public Goods, Externalities, and Government Behavior

Capital and Financial Markets

Macroeconomics: the Big Picture

The Spending Allocation Model

Unemployment and Employment

Productivity and Economic Growth

Money and Inflation

The Nature and Causes of Economic Fluctuations

The Economic Fluctuations Model

Using the Economic Fluctuations Model

Fiscal Policy

Monetary Policy

Economic Growth Around the World

International Trade

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