Question 1

Suppose the country of Dingo experienced an economic trough in January 2011. We can conclude that

Accepted Answer

A)  real GDP in Dingo was increasing in January 2011. 
B)  Dingoʹs potential GDP fell in 2011. 
C)  an expansion occurred after January 2011. 
D)  Dingo did not experience a recession in 2010. 
A)  real GDP in Dingo was increasing in January 2011. 
B)  Dingoʹs potential GDP fell in 2011. 
C)  an expansion occurred after January 2011. 
D)  Dingo did not experience a recession in 2010.

Question 2

$\begin{array}{|l|l|}
\hline \text { Component } & \begin{array}{l}
\text { Amount } \
\text { (billions of } \
\text { dollars) }
\end{array} \\hline \text { Net taxes } & 1,635 \\hline \begin{array}{l}
\text { Personal consumption } \
\text { expenditure }
\end{array} & 5,566 \\hline \text { Depreciation } & 622 \
\hline \text { Government expenditure } & 1,784 \
\hline \text { Gros s investment } & 1,234 \
\hline \text { Exports } & 957 \
\hline \text { Imports } & 1,138 \
\hline \text { Hous ehold saving } & 1,202 \
\hline
\end{array}$
-Using the data in the table above, what is the value of GDP?

Accepted Answer

A)  $8,403 billion 
B)  $10,679 billion 
C)  $9,541 billion 
D)  $13,516 billion 
A)  $8,403 billion 
B)  $10,679 billion 
C)  $9,541 billion 
D)  $13,516 billion

Question 3

When calculating GDP, underground economic activity is

Accepted Answer

A)  that portion of the time when we are enjoying leisure activities and not producing marketable goods. 
B)  the part of the economy purposely hidden. 
C)  an aspect of the quality of life, such as health and life expectancy. 
D)  the production of goods and services in the home. 
A)  that portion of the time when we are enjoying leisure activities and not producing marketable goods. 
B)  the part of the economy purposely hidden. 
C)  an aspect of the quality of life, such as health and life expectancy. 
D)  the production of goods and services in the home.

Question 4

Which of the following relationships is correct?

Accepted Answer

A)  Consumption expenditure = Net Investment - Depreciation 
B)  Depreciation = Gross Investment - Consumption expenditure 
C)  Net Investment = Gross Investment + Depreciation 
D)  Gross Investment = Net Investment + Depreciation 
A)  Consumption expenditure = Net Investment - Depreciation 
B)  Depreciation = Gross Investment - Consumption expenditure 
C)  Net Investment = Gross Investment + Depreciation 
D)  Gross Investment = Net Investment + Depreciation

Question 5

Gross domestic product GDP) measures the

Accepted Answer

A)  number of final goods and services sold in the economy in a given time period. 
B)  number of final goods and services produced in the economy in a given time period. 
C)  market value of final goods and services produced in the economy in a given time period. 
D)  market value of old and new final goods and services sold in the economy in a given time period. 
A)  number of final goods and services sold in the economy in a given time period. 
B)  number of final goods and services produced in the economy in a given time period. 
C)  market value of final goods and services produced in the economy in a given time period. 
D)  market value of old and new final goods and services sold in the economy in a given time period.

Question 6

Investment, as included in GDP, consists of what?

Accepted Answer

Investment is the purchase of

Question 7

Real GDP measures the

Accepted Answer

A)  general upward drift in prices. 
B)  changes in the prices of output measured in dollars. 
C)  value of total production linked to prices of a single year. 
D)  total profits earned by all businesses valued using prices from a single year. 
A)  general upward drift in prices. 
B)  changes in the prices of output measured in dollars. 
C)  value of total production linked to prices of a single year. 
D)  total profits earned by all businesses valued using prices from a single year.

Question 8

An expansion ends when the economy

Accepted Answer

A)  begins to grow following a peak. 
B)  has grown for two quarters in a row. 
C)  hits a trough and then enters a recession. 
D)  hits a peak and then enters a recession. 
A)  begins to grow following a peak. 
B)  has grown for two quarters in a row. 
C)  hits a trough and then enters a recession. 
D)  hits a peak and then enters a recession.

Question 9

The following data show Uruguay?s GDP using purchasing power parity in billions of dollars. $\begin{array}{ll}
\text {year }&2000&2001&2002&2003&2004&2005&2006&2007&2008\
GDP(\$)&26.1&25.8&23.3&24.3&27.9&30.1&33.9&37.2&40.2
\end{array}$
 Using the data, we can conclude that

Accepted Answer

A)  the standard of living did not change in Uruguay between 2000 and 2008. 
B)  Uruguay entered a recession in 2001. 
C)  Uruguay?s economy reached a peak in 2005. 
D)  potential GDP decreased in 2001. 
A)  the standard of living did not change in Uruguay between 2000 and 2008. 
B)  Uruguay entered a recession in 2001. 
C)  Uruguay?s economy reached a peak in 2005. 
D)  potential GDP decreased in 2001.

Question 10

In the national income accounts, the purchase of a new house counts as

Accepted Answer

A)  a transfer. 
B)  consumption expenditure. 
C)  investment. 
D)  an addition to inventory. 
A)  a transfer. 
B)  consumption expenditure. 
C)  investment. 
D)  an addition to inventory.

Question 11

-In the above figure, the diagram shows

Accepted Answer

A)  a downward trend in x. 
B)  a two-variable scatter diagram. 
C)  an upward trend in x. 
D)  a scatter diagram. 
A)  a downward trend in x. 
B)  a two-variable scatter diagram. 
C)  an upward trend in x. 
D)  a scatter diagram.

Question 12

The circular flow shows that

Accepted Answer

A)  aggregate production equals aggregate expenditure. 
B)  aggregate expenditure is less than aggregate income. 
C)  GDP equals aggregate income. 
D)  Both answers A and C are correct. 
A)  aggregate production equals aggregate expenditure. 
B)  aggregate expenditure is less than aggregate income. 
C)  GDP equals aggregate income. 
D)  Both answers A and C are correct.

Question 13

Which of the following are parts of the business cycles?

Accepted Answer

A)  inflation and recession 
B)  real GDP and potential GDP 
C)  peak and potential GDP 
D)  recession and expansion 
A)  inflation and recession 
B)  real GDP and potential GDP 
C)  peak and potential GDP 
D)  recession and expansion

Question 14

Neither intermediate goods nor used goods are included in GDP. Explain why these expenditures are not included in GDP.

Accepted Answer

Intermediate goods and used goods are no

Question 15

GDP does not directly include intermediate goods because

Accepted Answer

A)  that would understate the true size of GDP. 
B)  intermediate goods are not useful to consumers. 
C)  that would count the intermediate goods twice. 
D)  intermediate goods are not valuable. 
A)  that would understate the true size of GDP. 
B)  intermediate goods are not useful to consumers. 
C)  that would count the intermediate goods twice. 
D)  intermediate goods are not valuable.

Question 16

$$\begin{array} { | l | l | } 
\hline \text { Item } & \begin{array} { l } 
\text { Billions of } \
\text { dollars }
\end{array} \
\hline \text { Consumption expenditure } & 6,258 \
\hline \text { Investment } & 1,623 \\hline \begin{array}{l}
\text { Government expenditure on } \
\text { goods and services }
\end{array} & 1,630 \\hline \text { Exports of goods and services } & 998 \
\hline \text { Imports of goods and services } & 1,252 \
\hline
\end{array}$$
-The table above gives the values of different expenditures in the United States during 1999. Answer the following questions about the United States.
a) What was the value of net exports of goods and services in 1999?
b) What was nominal) GDP equal to in 1999?
c) What was the nominal) value of total production equal to in 1999?

Accepted Answer

a) Net exports of goods and services equ

Question 17

-In the above figure, the distance between points S and T represents

Accepted Answer

A)  a recession. 
B)  a trough. 
C)  a peak. 
D)  an expansion. 
A)  a recession. 
B)  a trough. 
C)  a peak. 
D)  an expansion.

Question 18

In the national income accounts, government expenditure on goods and services refer to those purchases made by

Accepted Answer

A)  all levels of government. 
B)  state and local governments only. 
C)  the federal government only. 
D)  federal and state governments only. 
A)  all levels of government. 
B)  state and local governments only. 
C)  the federal government only. 
D)  federal and state governments only.

Question 19

What would happen to measured GDP if more people started hiring workers to do house chores such as cooking and cleaning?

Accepted Answer

GDP is the value of the final goods and

Question 20

Real Gross Domestic Product is

Accepted Answer

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

Suppose the country of Dingo experienced an economic trough in January 2011. We can conclude that

Component Amount (billions of dollars) Net taxes 1,635 Personal consumption expenditure 5,566 Depreciation 622 Government expenditure 1,784 Gros s investment 1,234 Exports 957 Imports 1,138 Hous ehold saving 1,202 -Using the data in the table above, what is the value of GDP?

When calculating GDP, underground economic activity is

Which of the following relationships is correct?

Gross domestic product GDP) measures the

Investment, as included in GDP, consists of what?

Real GDP measures the

An expansion ends when the economy

The following data show Uruguay?s GDP using purchasing power parity in billions of dollars. $\begin{array}{ll}\text {year }&2000&2001&2002&2003&2004&2005&2006&2007&2008\\GDP(\$)&26.1&25.8&23.3&24.3&27.9&30.1&33.9&37.2&40.2\end{array}$ Using the data, we can conclude that

In the national income accounts, the purchase of a new house counts as

-In the above figure, the diagram shows

The circular flow shows that

Which of the following are parts of the business cycles?

Neither intermediate goods nor used goods are included in GDP. Explain why these expenditures are not included in GDP.

GDP does not directly include intermediate goods because

-In the above figure, the distance between points S and T represents

In the national income accounts, government expenditure on goods and services refer to those purchases made by

What would happen to measured GDP if more people started hiring workers to do house chores such as cooking and cleaning?

Real Gross Domestic Product is

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: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters

Exam 4: Measuring Gdp and Economic Growth

Suppose the country of Dingo experienced an economic trough in January 2011. We can conclude that

Component Amount (billions of dollars) Net taxes 1,635 Personal consumption expenditure 5,566 Depreciation 622 Government expenditure 1,784 Gros s investment 1,234 Exports 957 Imports 1,138 Hous ehold saving 1,202 -Using the data in the table above, what is the value of GDP?

When calculating GDP, underground economic activity is

Which of the following relationships is correct?

Gross domestic product GDP) measures the

Investment, as included in GDP, consists of what?

Real GDP measures the

An expansion ends when the economy

In the national income accounts, the purchase of a new house counts as

-In the above figure, the diagram shows

The circular flow shows that

Which of the following are parts of the business cycles?

Neither intermediate goods nor used goods are included in GDP. Explain why these expenditures are not included in GDP.

GDP does not directly include intermediate goods because

-In the above figure, the distance between points S and T represents

In the national income accounts, government expenditure on goods and services refer to those purchases made by

What would happen to measured GDP if more people started hiring workers to do house chores such as cooking and cleaning?

Real Gross Domestic Product is

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: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters