Question 1

A measure of a country's production is its

Accepted Answer

A)  gross daily production. 
B)  general daily product. 
C)  general domestic production. 
D)  gross domestic product. 
E)  gross total output. 
A)  gross daily production. 
B)  general daily product. 
C)  general domestic production. 
D)  gross domestic product. 
E)  gross total output.

Question 2

Investment is the expenditure done by

Accepted Answer

A)  savers. 
B)  firms. 
C)  governments. 
D)  the rest of the world. 
E)  Both answers A and B are correct. 
A)  savers. 
B)  firms. 
C)  governments. 
D)  the rest of the world. 
E)  Both answers A and B are correct.

Question 3

-The table gives data for a nation.What is the amount of the country's GDP?

Accepted Answer

A)  $6,000 billion 
B)  $6,200 billion 
C)  $6,600 billion 
D)  $6,900 billion 
E)  $5,800 billion. 
A)  $6,000 billion 
B)  $6,200 billion 
C)  $6,600 billion 
D)  $6,900 billion 
E)  $5,800 billion.

Question 4

The following are all final goods except

Accepted Answer

A)  flour used by the baker to make cup cakes. 
B)  bread eaten by a family for lunch. 
C)  pencils used by a 6th grader in class. 
D)  Nike shoes used by a basketball player. 
E)  a computer used by Intel to design new computer chips. 
A)  flour used by the baker to make cup cakes. 
B)  bread eaten by a family for lunch. 
C)  pencils used by a 6th grader in class. 
D)  Nike shoes used by a basketball player. 
E)  a computer used by Intel to design new computer chips.

Question 5

What is "underground production"?
 Is it included in GDP?

Accepted Answer

Underground production is the production

Question 6

The nation's supply of productive resources increases if

Accepted Answer

A)  investment is greater than depreciation. 
B)  investment equals depreciation. 
C)  investment is less than depreciation. 
D)  Both answers A and B can be correct. 
E)  None of the above answers are correct because the relationship between investment and depreciation has no bearing on the amount of the nation's productive resources. 
A)  investment is greater than depreciation. 
B)  investment equals depreciation. 
C)  investment is less than depreciation. 
D)  Both answers A and B can be correct. 
E)  None of the above answers are correct because the relationship between investment and depreciation has no bearing on the amount of the nation's productive resources.

Question 7

An increase in nominal GDP could result from an increase in i. production.
Ii) prices.
Iii) taxes and subsidies.

Accepted Answer

A)  i only 
B)  ii only 
C)  i and ii 
D)  i and iii 
E)  i, ii, and iii 
A)  i only 
B)  ii only 
C)  i and ii 
D)  i and iii 
E)  i, ii, and iii

Question 8

Expenditures in GDP do not include ________.

Accepted Answer

A)  used goods or financial assets 
B)  financial assets or investment 
C)  used goods or investment 
D)  investment, stocks, or bonds 
E)  government expenditures on goods and services 
A)  used goods or financial assets 
B)  financial assets or investment 
C)  used goods or investment 
D)  investment, stocks, or bonds 
E)  government expenditures on goods and services

Question 9

Total expenditure in the United States is equal to consumption expenditure plus investment

Accepted Answer

A)  plus government expenditure on goods and services plus imports of goods and services. 
B)  minus government expenditure on goods and services minus imports of goods and services. 
C)  plus government expenditure on goods and services plus exports of goods and services. 
D)  plus government expenditure on goods and services plus exports of goods and services minus imports of goods and services. 
E)  plus government expenditure on goods and services plus exports of goods and services plus imports of goods and services. 
A)  plus government expenditure on goods and services plus imports of goods and services. 
B)  minus government expenditure on goods and services minus imports of goods and services. 
C)  plus government expenditure on goods and services plus exports of goods and services. 
D)  plus government expenditure on goods and services plus exports of goods and services minus imports of goods and services. 
E)  plus government expenditure on goods and services plus exports of goods and services plus imports of goods and services.

Question 10

-The table above gives some data about GDP in a country for two years.Using these the chained-dollar method for calculating real GDP, real GDP increased by ________ percent between these two years.

Accepted Answer

A)  4 
B)  5 
C)  6 
D)  10 
E)  2 
A)  4 
B)  5 
C)  6 
D)  10 
E)  2

Question 11

The circular flow shows that GDP measures i. total income
Ii) total expenditures
Iii) price changes

Accepted Answer

A)  i only 
B)  ii only 
C)  iii only 
D)  i and ii 
E)  i, ii, and iii 
A)  i only 
B)  ii only 
C)  iii only 
D)  i and ii 
E)  i, ii, and iii

Question 12

If you mow the lawn yourself, the lawn mowing is considered household production.If you pay Larry's Lawn Service to mow your lawn, the lawn mowing is considered

Accepted Answer

A)  a leisure time activity. 
B)  a service, that will be counted as part of GDP. 
C)  a service, but is not counted as part of GDP because it simply replaces a service you used to perform. 
D)  rent, and therefore is counted as part of GDP. 
E)  underground production because it replaces the underground production of you mowing your lawn. 
A)  a leisure time activity. 
B)  a service, that will be counted as part of GDP. 
C)  a service, but is not counted as part of GDP because it simply replaces a service you used to perform. 
D)  rent, and therefore is counted as part of GDP. 
E)  underground production because it replaces the underground production of you mowing your lawn.

Question 13

-Bananaland produces only bananas and sunscreen and the quantities and prices for 2010 and 2011 are given in the table above.The base year is 2010.Real GDP in 2010 is equal to

Accepted Answer

A)  $800. 
B)  $640. 
C)  $625. 
D)  $500. 
E)  $200. 
A)  $800. 
B)  $640. 
C)  $625. 
D)  $500. 
E)  $200.

Question 14

Goods and services such as environmental quality, leisure time, and household production are not included in GDP because they are not

Accepted Answer

A)  productive activities. 
B)  for consumption. 
C)  bought in markets. 
D)  made for profit. 
E)  really durable goods. 
A)  productive activities. 
B)  for consumption. 
C)  bought in markets. 
D)  made for profit. 
E)  really durable goods.

Question 15

To calculate GDP it is necessary to

Accepted Answer

A)  add the total amounts of all the goods produced. 
B)  use the market price to place a dollar value on each good produced. 
C)  use production cost to place a dollar value on all goods produced. 
D)  use the average market price over the last five years to place a dollar value on all goods produced. 
E)  average the cost of producing a good with the price of the good to place a dollar value on all goods produced. 
A)  add the total amounts of all the goods produced. 
B)  use the market price to place a dollar value on each good produced. 
C)  use production cost to place a dollar value on all goods produced. 
D)  use the average market price over the last five years to place a dollar value on all goods produced. 
E)  average the cost of producing a good with the price of the good to place a dollar value on all goods produced.

Question 16

Measuring total production by valuing items at their market value allows us to

Accepted Answer

A)  separate the value of different goods with identical prices. 
B)  separate the value of different goods with different prices. 
C)  add together the value of different goods that have different prices. 
D)  add together the value of identical goods that have identical prices. 
E)  ignore the problem that goods and services differ in how long they last. 
A)  separate the value of different goods with identical prices. 
B)  separate the value of different goods with different prices. 
C)  add together the value of different goods that have different prices. 
D)  add together the value of identical goods that have identical prices. 
E)  ignore the problem that goods and services differ in how long they last.

Question 17

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

Question 18

If you buy a new water skis and other new equipment for $2,500 and take a week off of your job, where you earn $1,000 a week, to go water skiing.The equipment you purchased was all produced in the United States.You think that the week was worth $4,000.As a result of your vacation, GDP changes by how much?

Accepted Answer

GDP changes by only

Question 19

A restaurant buys fish to offer as a daily menu special.The purchase of the fish by the restaurant is

Accepted Answer

A)  a consumption expenditure. 
B)  an investment. 
C)  an intermediate good. 
D)  an example of government expenditures on goods and services. 
E)  part of net exports if the fish was caught beyond the U.S.border. 
A)  a consumption expenditure. 
B)  an investment. 
C)  an intermediate good. 
D)  an example of government expenditures on goods and services. 
E)  part of net exports if the fish was caught beyond the U.S.border.

Question 20

A standard definition of recession is

Accepted Answer

A)  a period of expansion in many sectors of the economy. 
B)  an increase in GDP that lasts for at least 6 months. 
C)  a decrease in GDP that lasts for at least 6 months. 
D)  an increase in unemployment from one month to the next. 
E)  a period of time when the unemployment rate exceeds 6.5 percent. 
A)  a period of expansion in many sectors of the economy. 
B)  an increase in GDP that lasts for at least 6 months. 
C)  a decrease in GDP that lasts for at least 6 months. 
D)  an increase in unemployment from one month to the next. 
E)  a period of time when the unemployment rate exceeds 6.5 percent.

A measure of a country's production is its

Investment is the expenditure done by

-The table gives data for a nation.What is the amount of the country's GDP?

The following are all final goods except

What is "underground production"? Is it included in GDP?

The nation's supply of productive resources increases if

An increase in nominal GDP could result from an increase in i. production. Ii) prices. Iii) taxes and subsidies.

Expenditures in GDP do not include ________.

Total expenditure in the United States is equal to consumption expenditure plus investment

-The table above gives some data about GDP in a country for two years.Using these the chained-dollar method for calculating real GDP, real GDP increased by ________ percent between these two years.

The circular flow shows that GDP measures i. total income Ii) total expenditures Iii) price changes

If you mow the lawn yourself, the lawn mowing is considered household production.If you pay Larry's Lawn Service to mow your lawn, the lawn mowing is considered

-Bananaland produces only bananas and sunscreen and the quantities and prices for 2010 and 2011 are given in the table above.The base year is 2010.Real GDP in 2010 is equal to

Goods and services such as environmental quality, leisure time, and household production are not included in GDP because they are not

To calculate GDP it is necessary to

Measuring total production by valuing items at their market value allows us to

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

A restaurant buys fish to offer as a daily menu special.The purchase of the fish by the restaurant is

A standard definition of recession is

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and the Natural Unemployment Rate

Economic Growth

Finance, Saving, and Investment

The Monetary System

Money, Interest, and Inflation

Aggregate Supply and Aggregate Demand

Aggregate Expenditure Multiplier

The Short-Run Policy Tradeoff

Fiscal Policy

Monetary Policy

International Trade Policy

International Finance

Filters

Exam 5: Gdp: a Measure of Total Production and Income

A measure of a country's production is its

Investment is the expenditure done by

-The table gives data for a nation.What is the amount of the country's GDP?

The following are all final goods except

What is "underground production"? Is it included in GDP?

The nation's supply of productive resources increases if

An increase in nominal GDP could result from an increase in i. production. Ii) prices. Iii) taxes and subsidies.

Expenditures in GDP do not include ________.

Total expenditure in the United States is equal to consumption expenditure plus investment

-The table above gives some data about GDP in a country for two years.Using these the chained-dollar method for calculating real GDP, real GDP increased by ________ percent between these two years.

The circular flow shows that GDP measures i. total income Ii) total expenditures Iii) price changes

If you mow the lawn yourself, the lawn mowing is considered household production.If you pay Larry's Lawn Service to mow your lawn, the lawn mowing is considered

-Bananaland produces only bananas and sunscreen and the quantities and prices for 2010 and 2011 are given in the table above.The base year is 2010.Real GDP in 2010 is equal to

Goods and services such as environmental quality, leisure time, and household production are not included in GDP because they are not

To calculate GDP it is necessary to

Measuring total production by valuing items at their market value allows us to

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

A restaurant buys fish to offer as a daily menu special.The purchase of the fish by the restaurant is

A standard definition of recession is

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and the Natural Unemployment Rate

Economic Growth

Finance, Saving, and Investment

The Monetary System

Money, Interest, and Inflation

Aggregate Supply and Aggregate Demand

Aggregate Expenditure Multiplier

The Short-Run Policy Tradeoff

Fiscal Policy

Monetary Policy

International Trade Policy

International Finance

Filters