Question 1

GDP equals net domestic product plus

Accepted Answer

A)  indirect business taxes and personal taxes. 
B)  retained earnings. 
C)  transfer payments and business transfers. 
D)  depreciation. 
A)  indirect business taxes and personal taxes. 
B)  retained earnings. 
C)  transfer payments and business transfers. 
D)  depreciation.

Question 2

Normally in the United States the relationship between nominal and real GDP for a given year is

Accepted Answer

A)  nominal GDP is greater than real GDP because of price decreases. 
B)  nominal GDP equals real GDP. 
C)  real GDP is greater than nominal GDP because of price increases. 
D)  nominal GDP is greater than real GDP because of price increases. 
A)  nominal GDP is greater than real GDP because of price decreases. 
B)  nominal GDP equals real GDP. 
C)  real GDP is greater than nominal GDP because of price increases. 
D)  nominal GDP is greater than real GDP because of price increases.

Question 3

Purchasing power parity prices are used to construct GDP data that

Accepted Answer

A)  is a proper measure of economic welfare. 
B)  do not omit the underground economy. 
C)  adjust for differences in population. 
D)  can be used to make more valid comparisons between one country and another. 
A)  is a proper measure of economic welfare. 
B)  do not omit the underground economy. 
C)  adjust for differences in population. 
D)  can be used to make more valid comparisons between one country and another.

Question 4

Why are only final goods and services included in measuring GDP? Give examples to complete your answer.

Accepted Answer

We purposely leave intermediate goods or

Question 5

Which of the following statements about the comparison between GDP in China and in the United States is correct?

Accepted Answer

A)  China's GDP per person is higher using purchasing power parity prices rather than the exchange rate when valuing China's GDP in dollars. 
B)  Using purchasing power parity prices to value China's GDP in dollars shows that China's GDP per person exceeds the GDP per person in the United States. 
C)  Using the exchange rate to value China's GDP in dollars shows that China's GDP per person exceeds the GDP per person in the United States. 
D)  None of the above answers are correct because they are all false statements. 
A)  China's GDP per person is higher using purchasing power parity prices rather than the exchange rate when valuing China's GDP in dollars. 
B)  Using purchasing power parity prices to value China's GDP in dollars shows that China's GDP per person exceeds the GDP per person in the United States. 
C)  Using the exchange rate to value China's GDP in dollars shows that China's GDP per person exceeds the GDP per person in the United States. 
D)  None of the above answers are correct because they are all false statements.

Question 6

Business cycles

Accepted Answer

A)  follow a pattern of trough, expansion, peak and recession. 
B)  are all identical in duration over the last century. 
C)  are more volatile during a Republican administration. 
D)  are unpredictable due to political upheavals and global markets. 
A)  follow a pattern of trough, expansion, peak and recession. 
B)  are all identical in duration over the last century. 
C)  are more volatile during a Republican administration. 
D)  are unpredictable due to political upheavals and global markets.

Question 7

Which of the following is TRUE regarding real GDP?
I. Real GDP is the value of the total production of the country's farms, factories, shops, and offices
II. Real GDP rises whenever inflation occurs.
III. Real GDP does not measure all that is produced.

Accepted Answer

A)  I and II 
B)  I and III 
C)  I, II and III 
D)  II and III 
A)  I and II 
B)  I and III 
C)  I, II and III 
D)  II and III

Question 8

If Nike, an American corporation, produces sneakers in Thailand this would

Accepted Answer

A)  add to neither U.S. GDP nor Thailand's GDP. 
B)  add to Thailand's GDP but not to U.S. GDP. 
C)  count for both Thailand's GDP and U.S. GDP. 
D)  count as part of U.S. GDP since it is a U.S. corporation. 
A)  add to neither U.S. GDP nor Thailand's GDP. 
B)  add to Thailand's GDP but not to U.S. GDP. 
C)  count for both Thailand's GDP and U.S. GDP. 
D)  count as part of U.S. GDP since it is a U.S. corporation.

Question 9

Define and discuss GDP.

Accepted Answer

GDP is the market value of all final goo

Question 10

Consumption expenditure is the payment by households for consumption of

Accepted Answer

A)  goods but not services. 
B)  goods and services. 
C)  services but not goods. 
D)  services and for saving. 
A)  goods but not services. 
B)  goods and services. 
C)  services but not goods. 
D)  services and for saving.

Question 11

Using a graph, draw and label the phases and turning points of the business cycle.

Accepted Answer

@#IMG-DLM& The figur

Question 12

To calculate GDP when using the income approach, you must add indirect business taxes and depreciation.

Accepted Answer

A) True 
 B)False

Question 13

Of the following, the largest component of GDP is

Accepted Answer

A)  gross private domestic investment. 
B)  personal consumption expenditures. 
C)  government expenditure on goods and services. 
D)  net exports of goods and services. 
A)  gross private domestic investment. 
B)  personal consumption expenditures. 
C)  government expenditure on goods and services. 
D)  net exports of goods and services.

Question 14

The calculation of the final goods and services sold in an economy would NOT include

Accepted Answer

A)  the purchase of a service by a household. 
B)  the purchase of a lawnmower by a household. 
C)  Ford Motor Company's purchase of a new industrial robot to be used to produce cars. 
D)  General Motors' purchases of tires for new automobiles. 
A)  the purchase of a service by a household. 
B)  the purchase of a lawnmower by a household. 
C)  Ford Motor Company's purchase of a new industrial robot to be used to produce cars. 
D)  General Motors' purchases of tires for new automobiles.

Question 15

-Use the information in the table above plus the fact that indirect taxes less subsidies are $10 billion and depreciation is $30 billion to calculate the value of GDP.

Accepted Answer

A)  $150 billion 
B)  $130 billion 
C)  $140 billion 
D)  $180 billion 
A)  $150 billion 
B)  $130 billion 
C)  $140 billion 
D)  $180 billion

Question 16

-In the above figure, the letters A, B, and C represent which positions in the business cycle?

Accepted Answer

A)  peak, expansion, and recession, respectively 
B)  peak, recession, and expansion, respectively 
C)  expansion, peak, and recession, respectively 
D)  recession, expansion, and peak, respectively 
A)  peak, expansion, and recession, respectively 
B)  peak, recession, and expansion, respectively 
C)  expansion, peak, and recession, respectively 
D)  recession, expansion, and peak, respectively

Question 17

Real Gross Domestic Product is

Accepted Answer

A)  the value of total production linked back to the prices of a single year. 
B)  the most that can be produced when the economy's resources are fully employed. 
C)  the productivity of labor. 
D)  the amount of people unemployed divided by the total labor force. 
A)  the value of total production linked back to the prices of a single year. 
B)  the most that can be produced when the economy's resources are fully employed. 
C)  the productivity of labor. 
D)  the amount of people unemployed divided by the total labor force.

Question 18

-Using the information in the table above, calculate the government's budget deficit or surplus.

Accepted Answer

A)  - $4 
B)  $2 
C)  $4 
D)  - $10 
A)  - $4 
B)  $2 
C)  $4 
D)  - $10

Question 19

-Using the information in the table above, net exports equals

Accepted Answer

A)  $650 billion. 
B)  - $70 billion. 
C)  $20 billion. 
D)  $1,370 billion. 
A)  $650 billion. 
B)  - $70 billion. 
C)  $20 billion. 
D)  $1,370 billion.

Question 20

Which of the following changes causes reported GDP to increase when, in fact, total production is unchanged?

Accepted Answer

A)  A shift from household production to market production. 
B)  The legalization of previously illegal activities. 
C)  Neither of the above will cause reported GDP to increase when total production does not change. 
D)  Both answers A and B are correct. 
A)  A shift from household production to market production. 
B)  The legalization of previously illegal activities. 
C)  Neither of the above will cause reported GDP to increase when total production does not change. 
D)  Both answers A and B are correct.

GDP equals net domestic product plus

Normally in the United States the relationship between nominal and real GDP for a given year is

Purchasing power parity prices are used to construct GDP data that

Why are only final goods and services included in measuring GDP? Give examples to complete your answer.

Which of the following statements about the comparison between GDP in China and in the United States is correct?

Business cycles

Which of the following is TRUE regarding real GDP? I. Real GDP is the value of the total production of the country's farms, factories, shops, and offices II. Real GDP rises whenever inflation occurs. III. Real GDP does not measure all that is produced.

If Nike, an American corporation, produces sneakers in Thailand this would

Define and discuss GDP.

Consumption expenditure is the payment by households for consumption of

Using a graph, draw and label the phases and turning points of the business cycle.

To calculate GDP when using the income approach, you must add indirect business taxes and depreciation.

Of the following, the largest component of GDP is

The calculation of the final goods and services sold in an economy would NOT include

-Use the information in the table above plus the fact that indirect taxes less subsidies are $10 billion and depreciation is $30 billion to calculate the value of GDP.

-In the above figure, the letters A, B, and C represent which positions in the business cycle?

Real Gross Domestic Product is

-Using the information in the table above, calculate the government's budget deficit or surplus.

-Using the information in the table above, net exports equals

Which of the following changes causes reported GDP to increase when, in fact, total production is unchanged?

What Is Economics

The Economic Problem

Demand and Supply

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 4: Measuring Gdp and Economic Growth

GDP equals net domestic product plus

Normally in the United States the relationship between nominal and real GDP for a given year is

Purchasing power parity prices are used to construct GDP data that

Why are only final goods and services included in measuring GDP? Give examples to complete your answer.

Which of the following statements about the comparison between GDP in China and in the United States is correct?

Business cycles

Which of the following is TRUE regarding real GDP? I. Real GDP is the value of the total production of the country's farms, factories, shops, and offices II. Real GDP rises whenever inflation occurs. III. Real GDP does not measure all that is produced.

If Nike, an American corporation, produces sneakers in Thailand this would

Define and discuss GDP.

Consumption expenditure is the payment by households for consumption of

Using a graph, draw and label the phases and turning points of the business cycle.

To calculate GDP when using the income approach, you must add indirect business taxes and depreciation.

Of the following, the largest component of GDP is

The calculation of the final goods and services sold in an economy would NOT include

-Use the information in the table above plus the fact that indirect taxes less subsidies are $10 billion and depreciation is $30 billion to calculate the value of GDP.

-In the above figure, the letters A, B, and C represent which positions in the business cycle?

Real Gross Domestic Product is

-Using the information in the table above, calculate the government's budget deficit or surplus.

-Using the information in the table above, net exports equals

Which of the following changes causes reported GDP to increase when, in fact, total production is unchanged?

What Is Economics

The Economic Problem

Demand and Supply

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters