Question 1

Given the following data for the economy, compute the value of GDP.

Accepted Answer

A) 56 
B) 83 
C) 90 
D) 141 
A) 56 
B) 83 
C) 90 
D) 141

Question 2

Bob's Barber Shop cut 3,000 heads of hair in 2016 and 3,100 in 2017. The price of a haircut was $7 in 2016 and $8 in 2017. If 2014 is the base year, what was Bob's contribution to nominal GDP in the year 2016?

Accepted Answer

A) $21,000 
B) $21,700 
C) $24,000 
D) $24,800 
A) $21,000 
B) $21,700 
C) $24,000 
D) $24,800

Question 3

The accuracy of the unemployment rate is criticized because:

Accepted Answer

A) unemployed homemakers and students who are not actively seeking employment are not included in the number of unemployed people. 
B) people who would like to work but have given up trying to find work are not included in the number of unemployed people. 
C) it fails to indicate how many people work at more than one job. 
D) people under 16 years of age and over 70 years of age are excluded from the data. 
A) unemployed homemakers and students who are not actively seeking employment are not included in the number of unemployed people. 
B) people who would like to work but have given up trying to find work are not included in the number of unemployed people. 
C) it fails to indicate how many people work at more than one job. 
D) people under 16 years of age and over 70 years of age are excluded from the data.

Question 4

Assume an economy produces only hamburgers and hot dogs and the base year is 2016.  
  Given the data in the table above, what is the value of real GDP in 2017?

Accepted Answer

A) $ 5,000 
B) $ 7,000 
C) $10,000 
D) $10,500 
A) $ 5,000 
B) $ 7,000 
C) $10,000 
D) $10,500

Question 5

Which of the following would be classified as a final good?

Accepted Answer

A) New computer software sold to a computer manufacturer for installation in new computers 
B) The services provided by lawyers to a computer manufacturer 
C) Computer chips sold to a computer manufacturer for installation in new computers 
D) A new computer sold to a business firm 
A) New computer software sold to a computer manufacturer for installation in new computers 
B) The services provided by lawyers to a computer manufacturer 
C) Computer chips sold to a computer manufacturer for installation in new computers 
D) A new computer sold to a business firm

Question 6

Data for an economy shows that the unemployment rate is 10 percent, the participation rate 80 percent, and 200 million people 16 years or older are not in the labor force. How many people are in the labor force in this economy?

Accepted Answer

A) 80 million 
B) 200 million 
C) 800 million 
D) 1.0 billion 
A) 80 million 
B) 200 million 
C) 800 million 
D) 1.0 billion

Question 7

Suppose a jar of DeLux popcorn that is ultimately sold to a customer at Friendly Groceries is produced by the following production process:  
$$\begin{array} { | l | c | r | } 
\hline { \text { Name of Campany } } & \text { Revenues } & \text { Cast af Pur chased Inguts } \
\hline \text { Citrus Growers Irc. } & \$ 0.75 & \mathbf { 0 } \
\hline \text { Florida Jarn Cormparty } & \$ 2.00 & \$ 0.75 \
\hline \text { The Comer Store } & \$ 2.50 & \$ 2.00 \
\hline
\end{array}$$  
If the corn was grown and the jar of popcorn produced in the year 2017, but the jar was sold at Friendly Groceries in the year 2018, what is the contribution of these transactions to GDP in the year 2017?

Accepted Answer

A) $0.50 
B) $2.00 
C) $2.50 
D) $3.00 
A) $0.50 
B) $2.00 
C) $2.50 
D) $3.00

Question 8

Suppose a jar of orange marmalade that is ultimately sold to a customer at The Corner Store is produced by the following production process: $$\begin{array} { | l | c | r | } 
\hline { \text { Name of Campany } } & \text { Revenues } & \text { Cast af Pur chased Inguts } \
\hline \text { Citrus Growers Inc. } & \$ 0.75 & \mathbf { 0 } \
\hline \text { Florida Jarn Cormpany } & \$ 2.00 & \$ 0.75 \
\hline \text { The Corner Store } & \$ 2.50 & \$ 2.00 \
\hline
\end{array}$$  
What is the value added of The Corner Store?

Accepted Answer

A) $0.50 
B) $1.75 
C) $2.00 
D) $2.50 
A) $0.50 
B) $1.75 
C) $2.00 
D) $2.50

Question 9

A drawback of using market values to aggregate the quantities of goods and services produced in an economy is that:

Accepted Answer

A) higher-priced items count more. 
B) GDP increases when not all goods are produced in greater quantities. 
C) market prices generally reflect the economic benefit consumers expect to receive from an item. 
D) not all economically valuable goods and services are bought and sold in markets. 
A) higher-priced items count more. 
B) GDP increases when not all goods are produced in greater quantities. 
C) market prices generally reflect the economic benefit consumers expect to receive from an item. 
D) not all economically valuable goods and services are bought and sold in markets.

Question 10

Real GDP measures the ________ of production.

Accepted Answer

A) change in the volume 
B) physical volume 
C) current dollar value 
D) current market value 
A) change in the volume 
B) physical volume 
C) current dollar value 
D) current market value

Given the following data for the economy, compute the value of GDP.

Bob's Barber Shop cut 3,000 heads of hair in 2016 and 3,100 in 2017. The price of a haircut was $7 in 2016 and $8 in 2017. If 2014 is the base year, what was Bob's contribution to nominal GDP in the year 2016?

The accuracy of the unemployment rate is criticized because:

Assume an economy produces only hamburgers and hot dogs and the base year is 2016. Given the data in the table above, what is the value of real GDP in 2017?

Which of the following would be classified as a final good?

Data for an economy shows that the unemployment rate is 10 percent, the participation rate 80 percent, and 200 million people 16 years or older are not in the labor force. How many people are in the labor force in this economy?

A drawback of using market values to aggregate the quantities of goods and services produced in an economy is that:

Real GDP measures the ________ of production.

Thinking Like an Economist

Comparative Advantage

Supply and Demand

Elasticity

Demand

Perfectly Competitive Supply

Efficiency, Exchange, and the Invisible Hand in Action

Monopoly, Oligopoly, and Monopolistic Competition

Games and Strategic Behavior

An Introduction to Behavioral Economics

Externalities, Property Rights, and the Environment

The Economics of Information

Labor Markets, Poverty, and Income Distribution

Public Goods and Tax Policy

International Trade and Trade Policy

Macroeconomics: The Birds Eye View of the Economy

Measuring the Price Level and Inflation

Economic Growth, Productivity, and Living Standards

The Labor Market: Workers, Wages, and Unemployment

Saving and Capital Formation

Money Prices and the Federal Reserve

Financial Markets and International Capital Flows

Short-Term Economic Fluctuations: An Introduction

Spending and Output in the Short Run

Stabilizing the Economy: The Role of the Fed

Aggregate Demand, Aggregate Supply, and Inflation

Exchange Rates and the Open Economy

Filters

Exam 17: Measuring Economic Activity: GDP and Unemployment

Given the following data for the economy, compute the value of GDP.

Bob's Barber Shop cut 3,000 heads of hair in 2016 and 3,100 in 2017. The price of a haircut was $7 in 2016 and $8 in 2017. If 2014 is the base year, what was Bob's contribution to nominal GDP in the year 2016?

The accuracy of the unemployment rate is criticized because:

Assume an economy produces only hamburgers and hot dogs and the base year is 2016. Given the data in the table above, what is the value of real GDP in 2017?

Which of the following would be classified as a final good?

Data for an economy shows that the unemployment rate is 10 percent, the participation rate 80 percent, and 200 million people 16 years or older are not in the labor force. How many people are in the labor force in this economy?

A drawback of using market values to aggregate the quantities of goods and services produced in an economy is that:

Real GDP measures the ________ of production.

Thinking Like an Economist

Comparative Advantage

Supply and Demand

Elasticity

Demand

Perfectly Competitive Supply

Efficiency, Exchange, and the Invisible Hand in Action

Monopoly, Oligopoly, and Monopolistic Competition

Games and Strategic Behavior

An Introduction to Behavioral Economics

Externalities, Property Rights, and the Environment

The Economics of Information

Labor Markets, Poverty, and Income Distribution

Public Goods and Tax Policy

International Trade and Trade Policy

Macroeconomics: The Birds Eye View of the Economy

Measuring the Price Level and Inflation

Economic Growth, Productivity, and Living Standards

The Labor Market: Workers, Wages, and Unemployment

Saving and Capital Formation

Money Prices and the Federal Reserve

Financial Markets and International Capital Flows

Short-Term Economic Fluctuations: An Introduction

Spending and Output in the Short Run

Stabilizing the Economy: The Role of the Fed

Aggregate Demand, Aggregate Supply, and Inflation

Exchange Rates and the Open Economy

Filters