Question 1

-A trend is

Accepted Answer

A)  a measure of closeness on a scatter diagram. 
B)  a general tendency for a variable to rise or fall. 
C)  the maximum value of a variable. 
D)  the minimum value of a variable. 
A)  a measure of closeness on a scatter diagram. 
B)  a general tendency for a variable to rise or fall. 
C)  the maximum value of a variable. 
D)  the minimum value of a variable.

Question 2

The sum of compensation to employees, rental income, corporate profits, net interest, and proprietors' income is

Accepted Answer

A)  gross domestic product. 
B)  gross domestic income. 
C)  net domestic income at factor cost. 
D)  net domestic product. 
A)  gross domestic product. 
B)  gross domestic income. 
C)  net domestic income at factor cost. 
D)  net domestic product.

Question 3

In the computation of GDP, Social Security payments count as

Accepted Answer

A)  transfer payments and are included in GDP. 
B)  transfer payments and are not included in GDP. 
C)  government expenditure on goods and services and are included in GDP. 
D)  government expenditure on goods and services and are not included in GDP. 
A)  transfer payments and are included in GDP. 
B)  transfer payments and are not included in GDP. 
C)  government expenditure on goods and services and are included in GDP. 
D)  government expenditure on goods and services and are not included in GDP.

Question 4

The business cycle progresses from an expansion to a peak to a recession and then to a trough.

Accepted Answer

A) True 
 B)False

Question 5

-Proprietors' income is a component of which approach to measuring GDP?

Accepted Answer

A)  incomes approach 
B)  expenditure approach 
C)  cost approach 
D)  output approach 
A)  incomes approach 
B)  expenditure approach 
C)  cost approach 
D)  output approach

Question 6

-In the above figure, which point represents a situation with significant shortages of labor, capital, and other resources?

Accepted Answer

A)  point F 
B)  point G 
C)  point I 
D)  point K 
A)  point F 
B)  point G 
C)  point I 
D)  point K

Question 7

-Of the following, which is CORRECT?

Accepted Answer

A)  Nominal GDP does not change when the production of goods and services increases. 
B)  Nominal GDP is not affected by changes in prices of goods and services. 
C)  Nominal GDP increases when the prices of goods and services increase. 
D)  Real GDP changes only when the prices of goods and services really change. 
A)  Nominal GDP does not change when the production of goods and services increases. 
B)  Nominal GDP is not affected by changes in prices of goods and services. 
C)  Nominal GDP increases when the prices of goods and services increase. 
D)  Real GDP changes only when the prices of goods and services really change.

Question 8

An U.S. firm buys a new industrial sewing machine from a company located in France. Which of the following is TRUE?
I.U.S. net exports decrease.
II.U.S. investment increases.

Accepted Answer

A)  only I 
B)  only II 
C)  both I and II 
D)  neither I nor II 
A)  only I 
B)  only II 
C)  both I and II 
D)  neither I nor II

Question 9

According to the article, the best description of Canada's position in the business cycle is

Accepted Answer

A)  at a peak. 
B)  at a trough. 
C)  in an expansion. 
D)  in a recession. 
A)  at a peak. 
B)  at a trough. 
C)  in an expansion. 
D)  in a recession.

Question 10

To see how variables evolve over time we use

Accepted Answer

A)  a scatter graph. 
B)  an evolution plot. 
C)  a cross-section plot. 
D)  a time-series graph. 
A)  a scatter graph. 
B)  an evolution plot. 
C)  a cross-section plot. 
D)  a time-series graph.

Question 11

Which of the following transfer payments is included in GDP?

Accepted Answer

A)  Social Security payments 
B)  welfare payments 
C)  veteran's benefits 
D)  none of the above 
A)  Social Security payments 
B)  welfare payments 
C)  veteran's benefits 
D)  none of the above

Question 12

-In the above figure, which point represents the under use of resources?

Accepted Answer

A)  point F 
B)  point G 
C)  point H 
D)  point K 
A)  point F 
B)  point G 
C)  point H 
D)  point K

Question 13

Net investment equals

Accepted Answer

A)  capital stock minus depreciation. 
B)  gross investment minus depreciation. 
C)  the total quantity of plant, equipment and buildings. 
D)  gross investment/depreciation. 
A)  capital stock minus depreciation. 
B)  gross investment minus depreciation. 
C)  the total quantity of plant, equipment and buildings. 
D)  gross investment/depreciation.

Question 14

The term "business cycle" most closely refers to the

Accepted Answer

A)  fluctuating profits of firms. 
B)  fiscal year. 
C)  accounting period used by firms. 
D)  alternating periods of expansions and recessions. 
A)  fluctuating profits of firms. 
B)  fiscal year. 
C)  accounting period used by firms. 
D)  alternating periods of expansions and recessions.

Question 15

The word "final" in the definition of GDP refers to

Accepted Answer

A)  not counting intermediate goods or services. 
B)  the time period when production took place. 
C)  valuing production at market prices. 
D)  counting the intermediate goods and services used to produce GDP. 
A)  not counting intermediate goods or services. 
B)  the time period when production took place. 
C)  valuing production at market prices. 
D)  counting the intermediate goods and services used to produce GDP.

Question 16

In the national income accounts, government expenditure on goods and services refer to those purchases made by

Accepted Answer

A)  federal and state governments only. 
B)  the federal government only. 
C)  state and local governments only. 
D)  all levels of government. 
A)  federal and state governments only. 
B)  the federal government only. 
C)  state and local governments only. 
D)  all levels of government.

Question 17

When calculating the compensation of employees part of GDP

Accepted Answer

A)  Social Security contributions must be included. 
B)  fringe benefits are not included. 
C)  taxes withheld on earnings are not included. 
D)  the value of vacation time must be included. 
A)  Social Security contributions must be included. 
B)  fringe benefits are not included. 
C)  taxes withheld on earnings are not included. 
D)  the value of vacation time must be included.

Question 18

-If imports are $100 million less than exports, government expenditures are $500 million, consumer expenditures are $1 billion, and gross investment spending is $500 million, then GDP is

Accepted Answer

A)  $1 billion. 
B)  $1.9 billion. 
C)  $2 billion. 
D)  $2.1 billion. 
A)  $1 billion. 
B)  $1.9 billion. 
C)  $2 billion. 
D)  $2.1 billion.

Question 19

-Real GDP can be criticized as a measure of economic welfare because it

Accepted Answer

A)  does not include the value of products produced in the household. 
B)  does not take account of the degradation of environmental quality. 
C)  does not include leisure time available to a society. 
D)  All of the above answers are correct. 
A)  does not include the value of products produced in the household. 
B)  does not take account of the degradation of environmental quality. 
C)  does not include leisure time available to a society. 
D)  All of the above answers are correct.

Question 20

Reported GDP increases when, in fact, total production is unchanged when
I.there is a shift from household production to market production.
II.a previously illegal activity is legalized.

Accepted Answer

A)  i only 
B)  II only 
C)  neither i nor II 
D)  both i and II 
A)  i only 
B)  II only 
C)  neither i nor II 
D)  both i and II

-A trend is

The sum of compensation to employees, rental income, corporate profits, net interest, and proprietors' income is

In the computation of GDP, Social Security payments count as

The business cycle progresses from an expansion to a peak to a recession and then to a trough.

-Proprietors' income is a component of which approach to measuring GDP?

-In the above figure, which point represents a situation with significant shortages of labor, capital, and other resources?

-Of the following, which is CORRECT?

An U.S. firm buys a new industrial sewing machine from a company located in France. Which of the following is TRUE? I.U.S. net exports decrease. II.U.S. investment increases.

According to the article, the best description of Canada's position in the business cycle is

To see how variables evolve over time we use

Which of the following transfer payments is included in GDP?

-In the above figure, which point represents the under use of resources?

Net investment equals

The term "business cycle" most closely refers to the

The word "final" in the definition of GDP refers to

In the national income accounts, government expenditure on goods and services refer to those purchases made by

When calculating the compensation of employees part of GDP

-If imports are $100 million less than exports, government expenditures are $500 million, consumer expenditures are $1 billion, and gross investment spending is $500 million, then GDP is

-Real GDP can be criticized as a measure of economic welfare because it

Reported GDP increases when, in fact, total production is unchanged when I.there is a shift from household production to market production. II.a previously illegal activity is legalized.

What Is Economics?

The Economic Problem

Demand and Supply

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 4: Measuring GDP and Economic Growth

-A trend is

The sum of compensation to employees, rental income, corporate profits, net interest, and proprietors' income is

In the computation of GDP, Social Security payments count as

The business cycle progresses from an expansion to a peak to a recession and then to a trough.

-Proprietors' income is a component of which approach to measuring GDP?

-In the above figure, which point represents a situation with significant shortages of labor, capital, and other resources?

-Of the following, which is CORRECT?

An U.S. firm buys a new industrial sewing machine from a company located in France. Which of the following is TRUE? I.U.S. net exports decrease. II.U.S. investment increases.

According to the article, the best description of Canada's position in the business cycle is

To see how variables evolve over time we use

Which of the following transfer payments is included in GDP?

-In the above figure, which point represents the under use of resources?

Net investment equals

The term "business cycle" most closely refers to the

The word "final" in the definition of GDP refers to

In the national income accounts, government expenditure on goods and services refer to those purchases made by

When calculating the compensation of employees part of GDP

-If imports are $100 million less than exports, government expenditures are $500 million, consumer expenditures are $1 billion, and gross investment spending is $500 million, then GDP is

-Real GDP can be criticized as a measure of economic welfare because it

Reported GDP increases when, in fact, total production is unchanged when I.there is a shift from household production to market production. II.a previously illegal activity is legalized.

What Is Economics?

The Economic Problem

Demand and Supply

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters