Question 1

A country that has a large real GDP per person might not necessarily have a high level of economic welfare because it may have

Accepted Answer

A)  environmental problems. 
B)  very little political freedom. 
C)  little leisure time. 
D)  All of the above answers are correct. 
A)  environmental problems. 
B)  very little political freedom. 
C)  little leisure time. 
D)  All of the above answers are correct.

Question 2

An indirect tax is exemplified by

Accepted Answer

A)  a sales tax. 
B)  a subsidy. 
C)  an income tax. 
D)  None of the above answers is correct. 
A)  a sales tax. 
B)  a subsidy. 
C)  an income tax. 
D)  None of the above answers is correct.

Question 3

Which of the following transfer payments is included in GDP?

Accepted Answer

A)  veteranʹs benefits 
B)  Social Security payments 
C)  welfare payments 
D)  none of the above 
A)  veteranʹs benefits 
B)  Social Security payments 
C)  welfare payments 
D)  none of the above

Question 4

-Using the above figure, during which month was the price for crude oil the highest?

Accepted Answer

A)  May 
B)  October 
C)  December 
D)  July 
A)  May 
B)  October 
C)  December 
D)  July

Question 5

ʺAs the credit crisis unfolded over the past year, one of the few certainties in the global economy seemed to be Chinaʹs ability to plough on regardless of double-digit growth rates...The ...crisis has also focused ...on the need to update a growth model that...is still dependent on assembling goods for export without adding much value and on heavy industries that create pollution. Chinese companies have continued to find new foreign markets for their products...several other factors point to a slowing property market...production of steel, cement and air conditioners was down... Retail sales have risen by 23 per cent in each of the last two monthsʺ.
Beijingʹs Burden,
-According to the article_________, are expected to contribute _________to Chinaʹs real GDP in 2008.

Accepted Answer

A)  exports and investment; negatively 
B)  consumption and government spending; negatively 
C)  rental income and investment; negatively 
D)  exports and consumption; positively 
A)  exports and investment; negatively 
B)  consumption and government spending; negatively 
C)  rental income and investment; negatively 
D)  exports and consumption; positively

Question 6

The relationship between real GDP and potential GDP is that

Accepted Answer

A)  real GDP always equals potential GDP. 
B)  real GDP never equals potential GDP. 
C)  real GDP is always below potential GDP. 
D)  real GDP fluctuates about potential GDP. 
A)  real GDP always equals potential GDP. 
B)  real GDP never equals potential GDP. 
C)  real GDP is always below potential GDP. 
D)  real GDP fluctuates about potential GDP.

Question 7

If we compare the U.S. GDP and the Chinese GDP,

Accepted Answer

A)  real U.S. GDP per person was much larger than Chinaʹs real GDP per person when purchasing power parity prices are used but is less than Chinaʹs real GDP per person when exchange rate prices are used. 
B)  U.S. real GDP per person is less than Chinaʹs real GDP per person once we adjust for currency differences. 
C)  Chinaʹs real GDP per person is less than real GDP per person in the United States. 
D)  real GDP per person is about the same in the two countries. 
A)  real U.S. GDP per person was much larger than Chinaʹs real GDP per person when purchasing power parity prices are used but is less than Chinaʹs real GDP per person when exchange rate prices are used. 
B)  U.S. real GDP per person is less than Chinaʹs real GDP per person once we adjust for currency differences. 
C)  Chinaʹs real GDP per person is less than real GDP per person in the United States. 
D)  real GDP per person is about the same in the two countries.

Question 8

Explain how GDP is measured according to the expenditure and income approaches.

Accepted Answer

GDP is measured using the expenditure ap

Question 9

GDP counts only final goods and services because this

Accepted Answer

A)  method avoids double counting of goods going through several stages of production. 
B)  method avoids understating the value of GDP produced during a given year. 
C)  amount can be more easily determined in the marketplace. 
D)  method avoids including any goods that are produced this year and sold next year. 
A)  method avoids double counting of goods going through several stages of production. 
B)  method avoids understating the value of GDP produced during a given year. 
C)  amount can be more easily determined in the marketplace. 
D)  method avoids including any goods that are produced this year and sold next year.

Question 10

Define gross investment and net investment. Discuss the relationship between gross investment and net investment.

Accepted Answer

Gross investment is the total amount spe

Question 11

Which of the following is  NOT  part of GDP calculated using the expenditure approach?

Accepted Answer

A)  expenditures by the federal government for national defense 
B)  social security payments made to the elderly 
C)  General Motorsʹ purchases of new capital equipment 
D)  the purchase of new homes by consumers 
A)  expenditures by the federal government for national defense 
B)  social security payments made to the elderly 
C)  General Motorsʹ purchases of new capital equipment 
D)  the purchase of new homes by consumers

Question 12

Compensation paid to employees represented _________of GDP for the United States in 2010.

Accepted Answer

A)  more than 50 percent 
B)  35 percent 
C)  about 5 percent 
D)  approximately 15 percent 
A)  more than 50 percent 
B)  35 percent 
C)  about 5 percent 
D)  approximately 15 percent

Question 13

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

Accepted Answer

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

Question 14

List and discuss various types of goods and services omitted from measured GDP.

Accepted Answer

Household production, such as preparing

Question 15

GDP equals

Accepted Answer

A)  C+I+G+X+M). 
B)  C+S+G+X-M) 
C)  C+I+G+X-M).. 
D)  C+S+G+X-M), 
A)  C+I+G+X+M). 
B)  C+S+G+X-M) 
C)  C+I+G+X-M).. 
D)  C+S+G+X-M),

Question 16

A common definition of a recession is a time with

Accepted Answer

A)  a decrease in real GDP for two or more successive quarters. 
B)  a decline in interest rates. 
C)  a decline in the price level. 
D)  a decrease in real GDP for two or more successive years. 
A)  a decrease in real GDP for two or more successive quarters. 
B)  a decline in interest rates. 
C)  a decline in the price level. 
D)  a decrease in real GDP for two or more successive years.

Question 17

At 2010 prices, the value of production in 2011 was 6 percentage points higher than in 2010. At 2011 prices, the value of production in 2011 was 4 percentage points higher than in 2010. Using the chain-weighted output index, real GDP is in 2011 than in 2010.

Accepted Answer

A)  7.5 percent greater 
B)  4 percent smaller 
C)  10 percent greater 
D)  5 percent greater 
A)  7.5 percent greater 
B)  4 percent smaller 
C)  10 percent greater 
D)  5 percent greater

Question 18

The fact that prices for similar goods differ across nations complicates comparisons of real GDP across countries.

Accepted Answer

A) True 
 B)False

Question 19

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

Accepted Answer

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

Question 20

What is the difference between real and nominal GDP and why do economists make this distinction?

Accepted Answer

Real GDP is a measure of the final goods

A country that has a large real GDP per person might not necessarily have a high level of economic welfare because it may have

An indirect tax is exemplified by

Which of the following transfer payments is included in GDP?

-Using the above figure, during which month was the price for crude oil the highest?

The relationship between real GDP and potential GDP is that

If we compare the U.S. GDP and the Chinese GDP,

Explain how GDP is measured according to the expenditure and income approaches.

GDP counts only final goods and services because this

Define gross investment and net investment. Discuss the relationship between gross investment and net investment.

Which of the following is NOT part of GDP calculated using the expenditure approach?

Compensation paid to employees represented _________of GDP for the United States in 2010.

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

List and discuss various types of goods and services omitted from measured GDP.

GDP equals

A common definition of a recession is a time with

At 2010 prices, the value of production in 2011 was 6 percentage points higher than in 2010. At 2011 prices, the value of production in 2011 was 4 percentage points higher than in 2010. Using the chain-weighted output index, real GDP is in 2011 than in 2010.

The fact that prices for similar goods differ across nations complicates comparisons of real GDP across countries.

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

What is the difference between real and nominal GDP and why do economists make this distinction?

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

A country that has a large real GDP per person might not necessarily have a high level of economic welfare because it may have

An indirect tax is exemplified by

Which of the following transfer payments is included in GDP?

-Using the above figure, during which month was the price for crude oil the highest?

The relationship between real GDP and potential GDP is that

If we compare the U.S. GDP and the Chinese GDP,

Explain how GDP is measured according to the expenditure and income approaches.

GDP counts only final goods and services because this

Define gross investment and net investment. Discuss the relationship between gross investment and net investment.

Which of the following is NOT part of GDP calculated using the expenditure approach?

Compensation paid to employees represented _________of GDP for the United States in 2010.

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

List and discuss various types of goods and services omitted from measured GDP.

GDP equals

A common definition of a recession is a time with

At 2010 prices, the value of production in 2011 was 6 percentage points higher than in 2010. At 2011 prices, the value of production in 2011 was 4 percentage points higher than in 2010. Using the chain-weighted output index, real GDP is in 2011 than in 2010.

The fact that prices for similar goods differ across nations complicates comparisons of real GDP across countries.

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

What is the difference between real and nominal GDP and why do economists make this distinction?

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