Question 1

The table given below reports the value of different economic variables of a country during a year.?
  
-Refer to Table 5.4. What will be the value of gross investment?

Accepted Answer

A)  $400 
B)  $1,200 
C)  $1,000 
D)  $1,800 
E)  Indeterminate 
A)  $400 
B)  $1,200 
C)  $1,000 
D)  $1,800 
E)  Indeterminate

Question 2

The sale of live cattle to a slaughterhouse constitutes a final transaction that is counted as part of the gross domestic product.

Accepted Answer

A) True 
 B)False

Question 3

The purchase of a new machine to replace the one that is worn out is:

Accepted Answer

A)  not included in GDP. 
B)  included in gross investment. 
C)  considered a personal consumption expenditure. 
D)  not included in GNP. 
E)  an increase in inventories. 
A)  not included in GDP. 
B)  included in gross investment. 
C)  considered a personal consumption expenditure. 
D)  not included in GNP. 
E)  an increase in inventories.

Question 4

The table given below lists the price per unit and output of computers and calculators (the only two goods produced by a nation) for the years 1995 and 2003.?
  
-Refer to Table 5.6. What is the nominal GDP for 2003?

Accepted Answer

A)  $223,000 
B)  $254,000 
C)  $376,000 
D)  $448,000 
E)  $520,000 
A)  $223,000 
B)  $254,000 
C)  $376,000 
D)  $448,000 
E)  $520,000

Question 5

The table given below reports the value of sales at each stage of production of an economics book.?
  
-Refer to Table 5.1. What is the contribution to GDP from the production of an economics book?

Accepted Answer

A)  $13.50 
B)  $7.75 
C)  $24.50 
D)  $38 
E)  $71.50 
A)  $13.50 
B)  $7.75 
C)  $24.50 
D)  $38 
E)  $71.50

Question 6

Personal income is equal to:

Accepted Answer

A)  NI minus personal income tax. 
B)  NI minus net factor income from abroad. 
C)  NI plus income currently earned but not received - income currently received but not earned. 
D)  NI minus indirect business taxes. 
E)  NI plus income currently received but not earned - income currently earned but not received. 
A)  NI minus personal income tax. 
B)  NI minus net factor income from abroad. 
C)  NI plus income currently earned but not received - income currently received but not earned. 
D)  NI minus indirect business taxes. 
E)  NI plus income currently received but not earned - income currently earned but not received.

Question 7

If the price level in any country increases by 15 percent during a year, then the price index for that year will be 85 as compared to the base year.

Accepted Answer

A) True 
 B)False

Question 8

If nominal GDP of a country increased and real GDP remained unchanged in a particular year, which of the following is most likely to have taken place?

Accepted Answer

A)  Output increased and the price level increased 
B)  Output increased and the price level decreased 
C)  Output remained constant and the price level increased 
D)  Output decreased and the price level decreased 
E)  Output increased and the price level remained constant 
A)  Output increased and the price level increased 
B)  Output increased and the price level decreased 
C)  Output remained constant and the price level increased 
D)  Output decreased and the price level decreased 
E)  Output increased and the price level remained constant

Question 9

The table given below reports the value of different economic variables of a country during a year.?
  
-Refer to Table 5.4. Compute the GNP of the country.

Accepted Answer

A)  $2,680 
B)  $2,480 
C)  $3,280 
D)  $3,880 
E)  $4,480 
A)  $2,680 
B)  $2,480 
C)  $3,280 
D)  $3,880 
E)  $4,480

Question 10

Which of the following components of GDP accounts for the bulk of national expenditures in the United States?

Accepted Answer

A)  Government purchases 
B)  Imports 
C)  Consumption 
D)  Investment 
E)  Exports 
A)  Government purchases 
B)  Imports 
C)  Consumption 
D)  Investment 
E)  Exports

Question 11

Which of the following is not included in national income?

Accepted Answer

A)  Corporate profits 
B)  Interest earnings 
C)  Capital consumption allowance 
D)  Rental income 
E)  Stockbroker commissions 
A)  Corporate profits 
B)  Interest earnings 
C)  Capital consumption allowance 
D)  Rental income 
E)  Stockbroker commissions

Question 12

National income accounting fills in the dollar values in the circular flow of income.

Accepted Answer

A) True 
 B)False

Question 13

Gross national product in terms of the income method is equal to national income plus indirect business taxes minus the capital consumption allowance.

Accepted Answer

A) True 
 B)False

Question 14

Scenario 5.1?Suppose that personal income is $250 billion. Furthermore, assume that retained corporate earnings are $2 billion, social security taxes are $15 billion, social security benefit checks equal $16 billion, the capital consumption allowance is $32 billion, and corporate taxes amount to $40 billion.
-Refer to Scenario 5.1. Gross national product of this nation will be:

Accepted Answer

A)  $177 billion. 
B)  $259 billion. 
C)  $291 billion. 
D)  $343 billion. 
E)  $323 billion. 
A)  $177 billion. 
B)  $259 billion. 
C)  $291 billion. 
D)  $343 billion. 
E)  $323 billion.

Question 15

If the value of intermediate goods and services are included in GDP, then:

Accepted Answer

A)  GDP would be understated. 
B)  GDP would act as a true indicator of economic welfare. 
C)  there would be double-counting. 
D)  it would lead to depreciation. 
E)  GDP would be able to give an exact estimate of the inventory in an economy. 
A)  GDP would be understated. 
B)  GDP would act as a true indicator of economic welfare. 
C)  there would be double-counting. 
D)  it would lead to depreciation. 
E)  GDP would be able to give an exact estimate of the inventory in an economy.

Question 16

The table given below reports the value of different economic variables of a country during a year.?
  
-Refer to Table 5.4. Calculate the national income of this country.

Accepted Answer

A)  $1,880 
B)  $2,480 
C)  $3,280 
D)  $3,880 
E)  $4,280 
A)  $1,880 
B)  $2,480 
C)  $3,280 
D)  $3,880 
E)  $4,280

Question 17

The consumer price index [CPI] measures price changes at an earlier stage of production than the producer price index [PPI], hence, increases in the CPI are usually followed by increases in the PPI.

Accepted Answer

A) True 
 B)False

Question 18

The term capital consumption allowance is defined as:

Accepted Answer

A)  the amount of net interest in an economy each year. 
B)  the estimated value of depreciation and obsolescence in investment goods. 
C)  the difference between exports and imports. 
D)  the disposition of disposable personal income. 
E)  the difference between earnings not received and receipts not earned. 
A)  the amount of net interest in an economy each year. 
B)  the estimated value of depreciation and obsolescence in investment goods. 
C)  the difference between exports and imports. 
D)  the disposition of disposable personal income. 
E)  the difference between earnings not received and receipts not earned.

Question 19

The output produced by domestically owned firms in foreign countries is included in the U.S. GDP but not in the U.S. GNP.

Accepted Answer

A) True 
 B)False

Question 20

The table given below reports the price of soda over four consecutive years.?
  
-Refer to Table 5.7. Compute the price index for the third year.

Accepted Answer

A)  150 
B)  183 
C)  100 
D)  118 
E)  130 
A)  150 
B)  183 
C)  100 
D)  118 
E)  130

The table given below reports the value of different economic variables of a country during a year.? -Refer to Table 5.4. What will be the value of gross investment?

The sale of live cattle to a slaughterhouse constitutes a final transaction that is counted as part of the gross domestic product.

The purchase of a new machine to replace the one that is worn out is:

The table given below lists the price per unit and output of computers and calculators (the only two goods produced by a nation) for the years 1995 and 2003.? -Refer to Table 5.6. What is the nominal GDP for 2003?

The table given below reports the value of sales at each stage of production of an economics book.? -Refer to Table 5.1. What is the contribution to GDP from the production of an economics book?

Personal income is equal to:

If the price level in any country increases by 15 percent during a year, then the price index for that year will be 85 as compared to the base year.

If nominal GDP of a country increased and real GDP remained unchanged in a particular year, which of the following is most likely to have taken place?

The table given below reports the value of different economic variables of a country during a year.? -Refer to Table 5.4. Compute the GNP of the country.

Which of the following components of GDP accounts for the bulk of national expenditures in the United States?

Which of the following is not included in national income?

National income accounting fills in the dollar values in the circular flow of income.

Gross national product in terms of the income method is equal to national income plus indirect business taxes minus the capital consumption allowance.

If the value of intermediate goods and services are included in GDP, then:

The table given below reports the value of different economic variables of a country during a year.? -Refer to Table 5.4. Calculate the national income of this country.

The consumer price index [CPI] measures price changes at an earlier stage of production than the producer price index [PPI], hence, increases in the CPI are usually followed by increases in the PPI.

The term capital consumption allowance is defined as:

The output produced by domestically owned firms in foreign countries is included in the U.S. GDP but not in the U.S. GNP.

The table given below reports the price of soda over four consecutive years.? -Refer to Table 5.7. Compute the price index for the third year.

The Wealth of Nations: Ownership and Economic Freedom

Scarcity and Opportunity Costs

The Market and Price System

The Aggregate Economy

An Introduction to the Foreign Exchapterange Market and the Balance of Payments

Unemployment and Inflation

Macroeconomic Equilibrium: Aggregate Demand and Supply

Aggregate Expenditures

Income and Expenditures Equilibrium

Fiscal Policy

Money and Banking

Monetary Policy

Macroeconomic Policy: Tradeoffs, Expectations, Credibility, and Sources of Business Cycles

Macroeconomic Viewpoints: New Keynesian, Monetarist, and New Classical

Economic Growth

Development Economics

Globalization

World Trade Equilibrium

International Trade Restrictions

Exchapterange Rates and Financial Links Between Countries

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Exam 5: National Income Accounting

The table given below reports the value of different economic variables of a country during a year.? -Refer to Table 5.4. What will be the value of gross investment?

The sale of live cattle to a slaughterhouse constitutes a final transaction that is counted as part of the gross domestic product.

The purchase of a new machine to replace the one that is worn out is:

The table given below lists the price per unit and output of computers and calculators (the only two goods produced by a nation) for the years 1995 and 2003.? -Refer to Table 5.6. What is the nominal GDP for 2003?

The table given below reports the value of sales at each stage of production of an economics book.? -Refer to Table 5.1. What is the contribution to GDP from the production of an economics book?

Personal income is equal to:

If the price level in any country increases by 15 percent during a year, then the price index for that year will be 85 as compared to the base year.

If nominal GDP of a country increased and real GDP remained unchanged in a particular year, which of the following is most likely to have taken place?

The table given below reports the value of different economic variables of a country during a year.? -Refer to Table 5.4. Compute the GNP of the country.

Which of the following components of GDP accounts for the bulk of national expenditures in the United States?

Which of the following is not included in national income?

National income accounting fills in the dollar values in the circular flow of income.

Gross national product in terms of the income method is equal to national income plus indirect business taxes minus the capital consumption allowance.

If the value of intermediate goods and services are included in GDP, then:

The table given below reports the value of different economic variables of a country during a year.? -Refer to Table 5.4. Calculate the national income of this country.

The consumer price index [CPI] measures price changes at an earlier stage of production than the producer price index [PPI], hence, increases in the CPI are usually followed by increases in the PPI.

The term capital consumption allowance is defined as:

The output produced by domestically owned firms in foreign countries is included in the U.S. GDP but not in the U.S. GNP.

The table given below reports the price of soda over four consecutive years.? -Refer to Table 5.7. Compute the price index for the third year.

The Wealth of Nations: Ownership and Economic Freedom

Scarcity and Opportunity Costs

The Market and Price System

The Aggregate Economy

An Introduction to the Foreign Exchapterange Market and the Balance of Payments

Unemployment and Inflation

Macroeconomic Equilibrium: Aggregate Demand and Supply

Aggregate Expenditures

Income and Expenditures Equilibrium

Fiscal Policy

Money and Banking

Monetary Policy

Macroeconomic Policy: Tradeoffs, Expectations, Credibility, and Sources of Business Cycles

Macroeconomic Viewpoints: New Keynesian, Monetarist, and New Classical

Economic Growth

Development Economics

Globalization

World Trade Equilibrium

International Trade Restrictions

Exchapterange Rates and Financial Links Between Countries

Filters