Question 1

Using dollar values to calculate GDP is advantageous because

Accepted Answer

A)  people can most easily understand dollar amounts 
B)  it employs a common unit of measurement for very different things 
C)  less valuable goods count the same as more valuable goods 
D)  other methods of calculating production are not as intuitively clear 
E)  money is a universal yardstick for measurement 
A)  people can most easily understand dollar amounts 
B)  it employs a common unit of measurement for very different things 
C)  less valuable goods count the same as more valuable goods 
D)  other methods of calculating production are not as intuitively clear 
E)  money is a universal yardstick for measurement

Question 2

Which of the following is the best definition of the unemployment rate?

Accepted Answer

A)  a percentage of people who were recently working but laid off or want to work (willing,able,and searching for work)but without jobs. 
B)  a percentage of people discouraged with the labor market and without work 
C)  a percentage of people not working 
D)  a percentage of people that do not need to work 
E)  a percentage of people willing and able to work 
A)  a percentage of people who were recently working but laid off or want to work (willing,able,and searching for work)but without jobs. 
B)  a percentage of people discouraged with the labor market and without work 
C)  a percentage of people not working 
D)  a percentage of people that do not need to work 
E)  a percentage of people willing and able to work

Question 3

GDP measures the output produced by all of a country's resources.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following trends would lower the unemployment rate associated with full employment?

Accepted Answer

A)  People become less educated over time. 
B)  More people are willing to move to find a job. 
C)  The government spends money to reduce the loss of jobs during a recession. 
D)  A larger proportion of jobs are seasonal in nature. 
E)  The federal government increases unemployment benefits. 
A)  People become less educated over time. 
B)  More people are willing to move to find a job. 
C)  The government spends money to reduce the loss of jobs during a recession. 
D)  A larger proportion of jobs are seasonal in nature. 
E)  The federal government increases unemployment benefits.

Question 5

In the language of economics,which of the following would be defined as investment?

Accepted Answer

A)  The purchase of a U.S.savings bond 
B)  The purchase of 100 shares of Ford Motor Company stock 
C)  The deposit of $1,000 into a savings account 
D)  The purchase of $500 worth of gold 
E)  The accumulation of inventories by a firm 
A)  The purchase of a U.S.savings bond 
B)  The purchase of 100 shares of Ford Motor Company stock 
C)  The deposit of $1,000 into a savings account 
D)  The purchase of $500 worth of gold 
E)  The accumulation of inventories by a firm

Question 6

The equation GDP = C + I + G + NX best describes the

Accepted Answer

A)  the output approach to measuring GDP 
B)  the factor payments approach to measuring GDP 
C)  the value added approach to measuring GDP 
D)  the expenditures approach to measuring GDP 
E)  the exchanges approach to measuring GDP 
A)  the output approach to measuring GDP 
B)  the factor payments approach to measuring GDP 
C)  the value added approach to measuring GDP 
D)  the expenditures approach to measuring GDP 
E)  the exchanges approach to measuring GDP

Question 7

The official definition of a recession is when real GDP declines for two consecutive quarters.

Accepted Answer

A) True 
 B)False

Question 8

In the factor payments approach to GDP,owners of capital receive

Accepted Answer

A)  wages 
B)  salaries 
C)  rent 
D)  interest 
E)  profit 
A)  wages 
B)  salaries 
C)  rent 
D)  interest 
E)  profit

Question 9

The committee of the National Bureau of Economic Research that determines when a recession in the U.S begins and ends looks at

Accepted Answer

A)  employment,industrial production,sales,and personal income. 
B)  real GDP. 
C)  employment and sales. 
D)  employment. 
E)  sales and industrial production. 
A)  employment,industrial production,sales,and personal income. 
B)  real GDP. 
C)  employment and sales. 
D)  employment. 
E)  sales and industrial production.

Question 10

An example of a flow variable is

Accepted Answer

A)  the number of cars in the United States today 
B)  the current value of your wealth 
C)  the population of Mexico 
D)  income 
E)  the number of sweaters a clothing store has on its shelves 
A)  the number of cars in the United States today 
B)  the current value of your wealth 
C)  the population of Mexico 
D)  income 
E)  the number of sweaters a clothing store has on its shelves

Question 11

In order to build a table,a furniture company buys $50 worth of wood from a lumber company and $20 worth of hardware from a metal products firm.If the value added by the furniture company is $200,what price would the table sell for according to the value added approach to GDP?

Accepted Answer

A)  $130 
B)  $150 
C)  $180 
D)  $200 
E)  $270 
A)  $130 
B)  $150 
C)  $180 
D)  $200 
E)  $270

Question 12

The human costs of unemployment are

Accepted Answer

A)  insignificant 
B)  not as important as the economic costs of unemployment 
C)  equal to the economic costs of unemployment 
D)  not measured in dollars,but are extremely important considerations 
E)  the opportunity cost of lost output 
A)  insignificant 
B)  not as important as the economic costs of unemployment 
C)  equal to the economic costs of unemployment 
D)  not measured in dollars,but are extremely important considerations 
E)  the opportunity cost of lost output

Question 13

Which of the following would not be included in government purchases?

Accepted Answer

A)  The purchase of a computer by a government agency 
B)  Welfare payments 
C)  Wages of government employees 
D)  The purchase of a police car 
E)  Spending on a new missile program 
A)  The purchase of a computer by a government agency 
B)  Welfare payments 
C)  Wages of government employees 
D)  The purchase of a police car 
E)  Spending on a new missile program

Question 14

When measuring GDP,economists count only the values of final goods and services because

Accepted Answer

A)  the final value is taxable 
B)  adding the values of intermediate products is too difficult a task 
C)  the value of all intermediate products is automatically included in the value of those final goods 
D)  intermediate products are overpriced 
E)  the final cost is the selling price,which is what economists want to know 
A)  the final value is taxable 
B)  adding the values of intermediate products is too difficult a task 
C)  the value of all intermediate products is automatically included in the value of those final goods 
D)  intermediate products are overpriced 
E)  the final cost is the selling price,which is what economists want to know

Question 15

Everything that consumers purchase during a period is included as part of consumption when calculating GDP.

Accepted Answer

A) True 
 B)False

Question 16

Real output per capita is calculated by

Accepted Answer

A)  multiplying the population by GDP 
B)  dividing nominal GDP by the population 
C)  dividing the population by nominal GDP 
D)  dividing real GDP by the population 
E)  dividing the population by real GDP 
A)  multiplying the population by GDP 
B)  dividing nominal GDP by the population 
C)  dividing the population by nominal GDP 
D)  dividing real GDP by the population 
E)  dividing the population by real GDP

Question 17

If we included intermediate goods in the calculation of GDP,

Accepted Answer

A)  we would be underestimating GDP 
B)  we would be accurately measuring GDP 
C)  we would be overestimating GDP 
D)  any measurement problems would be offset by including the sale of new goods 
E)  any measurement problems would be offset by including the final goods as well 
A)  we would be underestimating GDP 
B)  we would be accurately measuring GDP 
C)  we would be overestimating GDP 
D)  any measurement problems would be offset by including the sale of new goods 
E)  any measurement problems would be offset by including the final goods as well

Question 18

Even though households do not actually purchase certain items,the government estimates and adds to the consumption component what the household would pay for these items in the marketplace.An example of this type of item is

Accepted Answer

A)  a car that an individual builds from parts of old cars 
B)  food that a farm family grows for themselves 
C)  a pond that a household member digs by hand 
D)  police and fire protection 
E)  a barn that a household builds on their own property 
A)  a car that an individual builds from parts of old cars 
B)  food that a farm family grows for themselves 
C)  a pond that a household member digs by hand 
D)  police and fire protection 
E)  a barn that a household builds on their own property

Question 19

Which of the following statements about U.S.unemployment is true?

Accepted Answer

A)  All racial groups experience approximately the same rate of unemployment. 
B)  Black and white teenagers experience equally high rates of unemployment. 
C)  Blacks as a group experience higher rates of unemployment than do white teenagers. 
D)  Blacks experience higher rates of unemployment than do Hispanics. 
E)  White teenagers experience higher rates of unemployment than do any other group in the population. 
A)  All racial groups experience approximately the same rate of unemployment. 
B)  Black and white teenagers experience equally high rates of unemployment. 
C)  Blacks as a group experience higher rates of unemployment than do white teenagers. 
D)  Blacks experience higher rates of unemployment than do Hispanics. 
E)  White teenagers experience higher rates of unemployment than do any other group in the population.

Question 20

Susie grows corn in her backyard garden to feed her family.The corn she grows is not counted in GDP because

Accepted Answer

A)  it was not produced for the marketplace 
B)  it is an intermediate good that Susie will process further before feeding her family 
C)  goods produced using land are not included in GDP 
D)  the corn has low value 
E)  it reduces the amount of corn she will buy at the store 
A)  it was not produced for the marketplace 
B)  it is an intermediate good that Susie will process further before feeding her family 
C)  goods produced using land are not included in GDP 
D)  the corn has low value 
E)  it reduces the amount of corn she will buy at the store

Using dollar values to calculate GDP is advantageous because

Which of the following is the best definition of the unemployment rate?

GDP measures the output produced by all of a country's resources.

Which of the following trends would lower the unemployment rate associated with full employment?

In the language of economics,which of the following would be defined as investment?

The equation GDP = C + I + G + NX best describes the

The official definition of a recession is when real GDP declines for two consecutive quarters.

In the factor payments approach to GDP,owners of capital receive

The committee of the National Bureau of Economic Research that determines when a recession in the U.S begins and ends looks at

An example of a flow variable is

In order to build a table,a furniture company buys $50 worth of wood from a lumber company and $20 worth of hardware from a metal products firm.If the value added by the furniture company is $200,what price would the table sell for according to the value added approach to GDP?

The human costs of unemployment are

Which of the following would not be included in government purchases?

When measuring GDP,economists count only the values of final goods and services because

Everything that consumers purchase during a period is included as part of consumption when calculating GDP.

Real output per capita is calculated by

If we included intermediate goods in the calculation of GDP,

Even though households do not actually purchase certain items,the government estimates and adds to the consumption component what the household would pay for these items in the marketplace.An example of this type of item is

Which of the following statements about U.S.unemployment is true?

Susie grows corn in her backyard garden to feed her family.The corn she grows is not counted in GDP because

What is Economics?

Scarcity, Choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

What Macroeconomics Tries to Explain

The Price Level and Inflation

The Classical Long run Model

Economic Growth and Rising Living Standards

Economic Fluctuations

The Short-run Macro Model

Fiscal Policy

Money, Banks, and the Federal Reserve

The Money Market and Monetary Policy

Aggregate Demand and Aggregate Supply

Inflation and Monetary Policy

Exchange Rates and Macroeconomic Policy

Filters

Exam 6: Production, Income, and Employment

Using dollar values to calculate GDP is advantageous because

Which of the following is the best definition of the unemployment rate?

GDP measures the output produced by all of a country's resources.

Which of the following trends would lower the unemployment rate associated with full employment?

In the language of economics,which of the following would be defined as investment?

The equation GDP = C + I + G + NX best describes the

The official definition of a recession is when real GDP declines for two consecutive quarters.

In the factor payments approach to GDP,owners of capital receive

The committee of the National Bureau of Economic Research that determines when a recession in the U.S begins and ends looks at

An example of a flow variable is

In order to build a table,a furniture company buys $50 worth of wood from a lumber company and $20 worth of hardware from a metal products firm.If the value added by the furniture company is $200,what price would the table sell for according to the value added approach to GDP?

The human costs of unemployment are

Which of the following would not be included in government purchases?

When measuring GDP,economists count only the values of final goods and services because

Everything that consumers purchase during a period is included as part of consumption when calculating GDP.

Real output per capita is calculated by

If we included intermediate goods in the calculation of GDP,

Even though households do not actually purchase certain items,the government estimates and adds to the consumption component what the household would pay for these items in the marketplace.An example of this type of item is

Which of the following statements about U.S.unemployment is true?

Susie grows corn in her backyard garden to feed her family.The corn she grows is not counted in GDP because

What is Economics?

Scarcity, Choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

What Macroeconomics Tries to Explain

The Price Level and Inflation

The Classical Long run Model

Economic Growth and Rising Living Standards

Economic Fluctuations

The Short-run Macro Model

Fiscal Policy

Money, Banks, and the Federal Reserve

The Money Market and Monetary Policy

Aggregate Demand and Aggregate Supply

Inflation and Monetary Policy

Exchange Rates and Macroeconomic Policy

Filters