Question 1

In the equation GDP = C + I + G + NX,the G component refers to

Accepted Answer

A)  federal government expenditures plus all transfer payments. 
B)  the taxes and expenditure of all levels of government. 
C)  federal government expenditures on transfer payments, such as pensions and unemployment benefits. 
D)  the purchases of final goods and services by all levels of government, excluding transfer payments. 
A)  federal government expenditures plus all transfer payments. 
B)  the taxes and expenditure of all levels of government. 
C)  federal government expenditures on transfer payments, such as pensions and unemployment benefits. 
D)  the purchases of final goods and services by all levels of government, excluding transfer payments.

Question 2

Suppose that a very simple economy produces three goods: pizzas,haircuts,and backpacks.Suppose the quantities produced and their corresponding prices for 2009 and 2013 are shown in the table: $$\begin{array} { | l | c | c | c | c | } 
\hline &  { \mathbf { 2 0 1 3 } } && { 2017 } \
\hline \text { Product } & \text { Quantity } & \text { Price, } \$ & \text { Quantity } & \text { Price, \$ } \
\hline \text { Pizzas } & 100 & 10 & 120 & 12 \
\hline \text { Haircuts } & 50 & 15 & 45 & 20 \
\hline \text { Backpacks } & 200 & 40 & 210 & 45 \
\hline
\end{array}$$ Use the information to compute real GDP in the years 2013 and 2017.Calculate real GDP in 2017 assuming the base year is 2013.Real GDP is found by valuing GDP in a particular year using base year prices.When 2013 is the base year,real GDP for 2017 is found by multiplying 2013 prices by 2017 quantities and then adding the values up.Do the same calculation assuming the base year is 2017.Are the calculations different? Why?
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_____________________________________________________________________________________________

Accepted Answer

Real GDP is found by valuing GDP in a pa

Question 3

Which of the following has not been a long-term trend in the Australian economy since 1901?

Accepted Answer

A)  Increasing nominal GDP 
B)  Increasing real GDP 
C)  Increasing unemployment rates 
D)  Increasing real GDP per capita 
A)  Increasing nominal GDP 
B)  Increasing real GDP 
C)  Increasing unemployment rates 
D)  Increasing real GDP per capita

Question 4

Economist Paul Romer argued that

Accepted Answer

A)  technological change was determined by forces outside of the market. 
B)  at the firm level, diminishing returns to labour occur. 
C)  at the economy level, knowledge capital is subject to increasing returns. 
D)  knowledge capital is excludable but rival. 
A)  technological change was determined by forces outside of the market. 
B)  at the firm level, diminishing returns to labour occur. 
C)  at the economy level, knowledge capital is subject to increasing returns. 
D)  knowledge capital is excludable but rival.

Question 5

What factors determine labour productivity?
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_____________________________________________________________________________________________

Accepted Answer

The quantity of capital per ho

Question 6

The 'GDP deflator' is a measure of the price level and is calculated by dividing ________ by ________ and multiplying by 100.

Accepted Answer

A)  real GDP; nominal GDP 
B)  real GDP; the price level 
C)  nominal GDP; real GDP 
D)  the price level; nominal GDP 
A)  real GDP; nominal GDP 
B)  real GDP; the price level 
C)  nominal GDP; real GDP 
D)  the price level; nominal GDP

Question 7

Use the circular-flow diagram to explain why the value of total expenditure in an economy is equal to the value of total income.
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_____________________________________________________________________________________________

Accepted Answer

This question should be answered with a

Question 8

The GDP deflator is a measure of the price level which is calculated as nominal GDP divided by real GDP and multiplied by 100.

Accepted Answer

A) True 
 B)False

Question 9

How are 'intermediate goods' treated in the calculation of GDP?

Accepted Answer

A)  Their value is not counted separately, but included as part of the value of the final good of which they are an input. 
B)  Their value is counted separately, and their value is also included as part of the value of the final good of which they are an input. 
C)  They are included in the year that they are produced. 
D)  They are included only if they are imported. 
A)  Their value is not counted separately, but included as part of the value of the final good of which they are an input. 
B)  Their value is counted separately, and their value is also included as part of the value of the final good of which they are an input. 
C)  They are included in the year that they are produced. 
D)  They are included only if they are imported.

Question 10

What is meant by 'intermediate goods' and are they included in the measure of GDP?
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_____________________________________________________________________________________________

Accepted Answer

These are goods that are used

Question 11

If prices are rising on average,then real GDP will

Accepted Answer

A)  always be equal to nominal GDP. 
B)  be greater than nominal GDP in the years after the base year. 
C)  be less than nominal GDP in the years before the base year. 
D)  be greater than nominal GDP in the years before the base year. 
A)  always be equal to nominal GDP. 
B)  be greater than nominal GDP in the years after the base year. 
C)  be less than nominal GDP in the years before the base year. 
D)  be greater than nominal GDP in the years before the base year.

Question 12

In the circular flow,________ supply the factors of production,and ________ goods and services.

Accepted Answer

A)  households; sell 
B)  households; buy 
C)  firms; sell 
D)  firms; buy 
A)  households; sell 
B)  households; buy 
C)  firms; sell 
D)  firms; buy

Question 13

Outline the trend in real GDP per capita in Australia from 1901 to 2016.
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_____________________________________________________________________________________________

Accepted Answer

It has trended upwards,increas

Question 14

The purchase of shares in a company is not included in the investment component of GDP.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is included in the gross domestic product for an economy in a given year?

Accepted Answer

A)  The value of intermediate goods produced in that year 
B)  The value of used goods sold in that year 
C)  The value of final goods produced in that year 
D)  All of the above would be included in the gross domestic product for an economy in a given year. 
A)  The value of intermediate goods produced in that year 
B)  The value of used goods sold in that year 
C)  The value of final goods produced in that year 
D)  All of the above would be included in the gross domestic product for an economy in a given year.

Question 16

In the long run,a country will experience an increasing standard of living only if it experiences

Accepted Answer

A)  a high rate of consumption. 
B)  continuous technological change. 
C)  a high rate of labour force growth. 
D)  a slow rate of population growth. 
A)  a high rate of consumption. 
B)  continuous technological change. 
C)  a high rate of labour force growth. 
D)  a slow rate of population growth.

Question 17

Why do we subtract import spending from total expenditures?
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_____________________________________________________________________________________________

Accepted Answer

When we total up consumption expenditure

Question 18

An example of an 'intermediate good' would be

Accepted Answer

A)  a new car. 
B)  a used car. 
C)  the tyres on a new car. 
D)  new tyres to replace old tyres on a used car. 
A)  a new car. 
B)  a used car. 
C)  the tyres on a new car. 
D)  new tyres to replace old tyres on a used car.

Question 19

Which of the following is counted in GDP?

Accepted Answer

A)  The value of goods and services produced in the underground economy 
B)  The cost of a speed boat purchased at Bob's Boats used by drug smugglers 
C)  The value of do-it-yourself work 
D)  The value of leisure 
A)  The value of goods and services produced in the underground economy 
B)  The cost of a speed boat purchased at Bob's Boats used by drug smugglers 
C)  The value of do-it-yourself work 
D)  The value of leisure

Question 20

The economic growth model focuses on the long-run increase in the productivity of capital.

Accepted Answer

A) True 
 B)False

In the equation GDP = C + I + G + NX,the G component refers to

Which of the following has not been a long-term trend in the Australian economy since 1901?

Economist Paul Romer argued that

What factors determine labour productivity? _ _

The 'GDP deflator' is a measure of the price level and is calculated by dividing by and multiplying by 100.

Use the circular-flow diagram to explain why the value of total expenditure in an economy is equal to the value of total income. _ _

The GDP deflator is a measure of the price level which is calculated as nominal GDP divided by real GDP and multiplied by 100.

How are 'intermediate goods' treated in the calculation of GDP?

What is meant by 'intermediate goods' and are they included in the measure of GDP? _ _

If prices are rising on average,then real GDP will

In the circular flow, supply the factors of production,and goods and services.

Outline the trend in real GDP per capita in Australia from 1901 to 2016. _ _

The purchase of shares in a company is not included in the investment component of GDP.

Which of the following is included in the gross domestic product for an economy in a given year?

In the long run,a country will experience an increasing standard of living only if it experiences

Why do we subtract import spending from total expenditures? _ _

An example of an 'intermediate good' would be

Which of the following is counted in GDP?

The economic growth model focuses on the long-run increase in the productivity of capital.

Economics: Foundations and Models

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: The Responsiveness of Demand and Supply

Economic Efficiency,government Price Setting and Taxes

Technology,production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition and Oligopoly

The Markets for Labour and Other Factors of Production

Government Intervention in the Market

Social Policy and Inequality

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money,banks and the Reserve Bank of Australia

Monetary Policy

Fiscal Policy

Comparative Advantage and the Gains From International Trade

Macroeconomics in an Open Economy

Filters

Exam 13: Gdp: Measuring Total Production, income and Economic Growth

In the equation GDP = C + I + G + NX,the G component refers to

Which of the following has not been a long-term trend in the Australian economy since 1901?

Economist Paul Romer argued that

What factors determine labour productivity? _____________________________________________________________________________________________ _____________________________________________________________________________________________

The 'GDP deflator' is a measure of the price level and is calculated by dividing ________ by ________ and multiplying by 100.

The GDP deflator is a measure of the price level which is calculated as nominal GDP divided by real GDP and multiplied by 100.

How are 'intermediate goods' treated in the calculation of GDP?

What is meant by 'intermediate goods' and are they included in the measure of GDP? _____________________________________________________________________________________________ _____________________________________________________________________________________________

If prices are rising on average,then real GDP will

In the circular flow,________ supply the factors of production,and ________ goods and services.

Outline the trend in real GDP per capita in Australia from 1901 to 2016. _____________________________________________________________________________________________ _____________________________________________________________________________________________

The purchase of shares in a company is not included in the investment component of GDP.

Which of the following is included in the gross domestic product for an economy in a given year?

In the long run,a country will experience an increasing standard of living only if it experiences

Why do we subtract import spending from total expenditures? _____________________________________________________________________________________________ _____________________________________________________________________________________________

An example of an 'intermediate good' would be

Which of the following is counted in GDP?

The economic growth model focuses on the long-run increase in the productivity of capital.

Economics: Foundations and Models

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: The Responsiveness of Demand and Supply

Economic Efficiency,government Price Setting and Taxes

Technology,production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition and Oligopoly

The Markets for Labour and Other Factors of Production

Government Intervention in the Market

Social Policy and Inequality

Unemployment and Inflation

Aggregate Demand and Aggregate Supply Analysis

Money,banks and the Reserve Bank of Australia

Monetary Policy

Fiscal Policy

Comparative Advantage and the Gains From International Trade

Macroeconomics in an Open Economy

Filters

What factors determine labour productivity? _ _

The 'GDP deflator' is a measure of the price level and is calculated by dividing by and multiplying by 100.

What is meant by 'intermediate goods' and are they included in the measure of GDP? _ _

In the circular flow, supply the factors of production,and goods and services.

Outline the trend in real GDP per capita in Australia from 1901 to 2016. _ _

Why do we subtract import spending from total expenditures? _ _