Exam 5: Measuring a Nations Production and Income

Gross domestic product measured in terms of the prices of a fixed, or base, year is called:

All economic activities are included in the GDP.

In 1929- 1933, the U.S. experienced unemployment rates exceeding 25 percent and the U.S. real GDP contracted over 33 percent. During this period, the U.S. economy experienced:

For large industrialized countries like the United States, we know that:

The fact that the Nigerian oil industry is managed by large foreign corporations tends to make Nigeria's:

If no foreign companies produce in a country, but many of the country's companies produce abroad, then it is probably true:

Explain the two approaches that can be used to compute GDP. Why do these two approaches lead to the same value for GDP?

Suppose Mexico does not allow multinational companies to put up factories within its borders, but has a lot of Mexican companies with factories in Brazil and Argentina. In this example, is GDP or GNP larger for Mexico? Explain.

When calculating GDP, exports are _______ and imports are _______.

If a country experiences a trade deficit (net exports are negative), we know that GDP will be less than GNP.

The most severe decline in output in U.S. history took place during:

Refer to Application 2, "Comparing the Severity of Recessions," to answer the following questions: -According to the application, compared to just looking at the unemployment rate, a more correct way to measure the damage caused by the recession is to:

Nominal GDP measures the value of all goods and services:

If the economy is experiencing inflation, then nominal GDP is greater than real GDP after the base year.

In the circular flow diagram, firms _______ goods and services and households _______ inputs.

The concerns of macroeconomics include all of the following except:

From Application 1, Wal- Mart's 2008 value added was roughly equal to the GDP of _______, the _______ largest economy in the world.

Nominal GDP is not an accurate measure of the real level of economic activity in a country because:

Personal income measures the amount of:

A U.S. fast- food chain opens a branch in Spain. The sales of the restaurant is counted as part of the U.S. GDP and the Spanish GNP.