Question 1

What is an injection?

Accepted Answer

A) Any spending that is dependent on the current level of income. 
B) Any flow of money that comes directly from financial intermediaries. 
C) The flow of money that comes directly from the central bank. 
D) Any spending that is not dependent on the current level of income. 
A) Any spending that is dependent on the current level of income. 
B) Any flow of money that comes directly from financial intermediaries. 
C) The flow of money that comes directly from the central bank. 
D) Any spending that is not dependent on the current level of income.

Question 2

What is real GDP?

Accepted Answer

A) Nominal GDP minus taxes. 
B) Nominal GDP minus depreciation. 
C) Nominal GDP minus the price level in that year. 
D) The value of GDP in terms of prices prevailing in a given base year. 
E) The value of GDP in terms of prices prevailing at the time of measurement. 
A) Nominal GDP minus taxes. 
B) Nominal GDP minus depreciation. 
C) Nominal GDP minus the price level in that year. 
D) The value of GDP in terms of prices prevailing in a given base year. 
E) The value of GDP in terms of prices prevailing at the time of measurement.

Question 3

Are all productive activities not included in the measurement of GDP illegal?

Accepted Answer

There are many productive activities exc

Question 4

Individuals in the household sector earn income by receiving payment for the goods and services that they sell.

Accepted Answer

A) True 
 B)False

Question 5

-Refer to the above to answer this question.What is flow (2)?

Accepted Answer

A) Consumer goods and services. 
B) Factor services. 
C) Factor incomes. 
D) Consumption. 
A) Consumer goods and services. 
B) Factor services. 
C) Factor incomes. 
D) Consumption.

Question 6

Which of the following would not cause an increase in nominal GDP?

Accepted Answer

A) An increase in the output of goods and services with no change in prices. 
B) An increase in the prices of goods and services with no change in their output. 
C) An increase in both the output and the prices of goods and services. 
D) No change in both the output and the prices of goods and services. 
A) An increase in the output of goods and services with no change in prices. 
B) An increase in the prices of goods and services with no change in their output. 
C) An increase in both the output and the prices of goods and services. 
D) No change in both the output and the prices of goods and services.

Question 7

What is the level of savings in an economy with no government and no international trade,if total factor income is $600 and consumption spending is $480?

Accepted Answer

A) -$120. 
B) $120. 
C) $1,080. 
D) Cannot be determined from the information given. 
A) -$120. 
B) $120. 
C) $1,080. 
D) Cannot be determined from the information given.

Question 8

Assume that instead of regarding automobile purchases as consumer goods,national income accountants were to categorize them as capital goods? What would be the result?

Accepted Answer

A) GDP would remain the same,but disposable income would be less. 
B) Disposable income would remain the same,but savings would increase. 
C) National income accounts would remain unchanged. 
D) Consumption spending would increase. 
A) GDP would remain the same,but disposable income would be less. 
B) Disposable income would remain the same,but savings would increase. 
C) National income accounts would remain unchanged. 
D) Consumption spending would increase.

Question 9

What does national income measure?

Accepted Answer

A) The value of a country's GDP expressed in "real" terms. 
B) The after-tax income of all suppliers. 
C) The total earnings of all the factors of production. 
D) The total tax revenue received by the government. 
A) The value of a country's GDP expressed in "real" terms. 
B) The after-tax income of all suppliers. 
C) The total earnings of all the factors of production. 
D) The total tax revenue received by the government.

Question 10

What does the concept of net investment refer to?

Accepted Answer

A) The amount of capital stock used up in producing the current year's GDP. 
B) The difference between the book value and the replacement value of all capital stock. 
C) Gross investment less exported capital goods. 
D) Total investment less the amount of capital goods used up in producing the year's output. 
E) The amount of depreciation plus the amount of new investment during a given year. 
A) The amount of capital stock used up in producing the current year's GDP. 
B) The difference between the book value and the replacement value of all capital stock. 
C) Gross investment less exported capital goods. 
D) Total investment less the amount of capital goods used up in producing the year's output. 
E) The amount of depreciation plus the amount of new investment during a given year.

Question 11

If National Income is $1,000,undistributed corporate profits are $150,corporate taxes are $75,other income not paid out is $100 and personal income is $1,050.What is the value of government transfer payments?

Accepted Answer

Personal income = National income less u

Question 12

Which of the following should be included in GDP (if reported)?

Accepted Answer

A) A friend gives you $100 as a loan. 
B) A friend gives you $100 as a birthday present. 
C) A friend gives you $100 for your old bike. 
D) A friend gives you $100 for tutoring him in economics. 
A) A friend gives you $100 as a loan. 
B) A friend gives you $100 as a birthday present. 
C) A friend gives you $100 for your old bike. 
D) A friend gives you $100 for tutoring him in economics.

Question 13

All of the following,except one,are injections.Which is the exception?

Accepted Answer

A) Investment. 
B) Taxes. 
C) Exports. 
D) Government purchases. 
A) Investment. 
B) Taxes. 
C) Exports. 
D) Government purchases.

Question 14

What is the result if Professor Mumbler decorates his own home?

Accepted Answer

A) This activity is excluded from GDP because it is not productive work. 
B) This activity is excluded from GDP because an intermediate good is involved. 
C) This is a productive activity but is excluded from GDP because no market transaction occurs. 
D) This activity is included in GDP because it reflects production. 
E) This activity is included in GDP only to the extent of Mumbler's opportunity costs. 
A) This activity is excluded from GDP because it is not productive work. 
B) This activity is excluded from GDP because an intermediate good is involved. 
C) This is a productive activity but is excluded from GDP because no market transaction occurs. 
D) This activity is included in GDP because it reflects production. 
E) This activity is included in GDP only to the extent of Mumbler's opportunity costs.

Question 15

Which of the following summations is GDP equal to?

Accepted Answer

A) C + Ig + G + Xn. 
B) C + Ig + G - Xn. 
C) C + In + G + Xn. 
D) C - In - G - Xn. 
A) C + Ig + G + Xn. 
B) C + Ig + G - Xn. 
C) C + In + G + Xn. 
D) C - In - G - Xn.

Question 16

Which of the following transactions is considered a purchase of final output? Which one is considered the purchase of an intermediate good?
(a)Albert purchased a camera from Canada to use on his vacation in the Bahamas.
(b)Albert purchased a roll of film to use in his camera.
(c)An owner of a bakery purchased wheat to make bread.
(d)The Ford Company purchased 10 tons of steel to make cars.
(e)Sue purchased cleaning detergent to use in her newly purchased washing machine.

Accepted Answer

(a)Final output.
(b)

Question 17

Describe in your own words the difference between a stock and a flow.For each of the following activities,determine whether it is a stock concept or a flow concept:
(a)Sue earns $5.75 per hour working at the Burger Barn.
(b)On his way home from work,Sam finds a ten-dollar bill.
(c)Upon graduation,John accepts a job with a salary of $2,000 per month.
(d)Jennifer saves 10% of her monthly income.
(e)In 2004,Canada's production of pig-iron was 2,000 metric tonnes.
(f)Japan has a capital to labour ratio of 10 whereas China has a capital to labour ratio of 2.
A stock concept is a measure of something at a particular point in time.
A flow concept is a measure of something during a specific time period.

Accepted Answer

(a)Flow.
(b)Stock.
(

Question 18

Why are GDP data criticized as being inaccurate measures of economic welfare?

Accepted Answer

A) They do not measure changes in the distribution of income. 
B) They do not measure changes in the amount of leisure. 
C) They do not measure changes in product quality. 
D) They do not measure the adverse effects of economic activity upon the environment. 
E) They do not measure changes in the distribution of income,the amount of leisure,product quality,and the adverse effects of economic activity upon the environment. 
A) They do not measure changes in the distribution of income. 
B) They do not measure changes in the amount of leisure. 
C) They do not measure changes in product quality. 
D) They do not measure the adverse effects of economic activity upon the environment. 
E) They do not measure changes in the distribution of income,the amount of leisure,product quality,and the adverse effects of economic activity upon the environment.

Question 19

The two conceptual approaches used to measure GDP are the expenditures approach and the incomes approach.

Accepted Answer

A) True 
 B)False

Question 20

Use the following,with Year 1 as the base year:
  
-Refer to the information above to answer this question.What is the value of nominal GDP in Year 2?

Accepted Answer

A) $605. 
B) $651. 
C) $7,500. 
D) $8,250. 
E) $8,910. 
A) $605. 
B) $651. 
C) $7,500. 
D) $8,250. 
E) $8,910.

What is an injection?

What is real GDP?

Are all productive activities not included in the measurement of GDP illegal?

Individuals in the household sector earn income by receiving payment for the goods and services that they sell.

-Refer to the above to answer this question.What is flow (2)?

Which of the following would not cause an increase in nominal GDP?

What is the level of savings in an economy with no government and no international trade,if total factor income is $600 and consumption spending is $480?

Assume that instead of regarding automobile purchases as consumer goods,national income accountants were to categorize them as capital goods? What would be the result?

What does national income measure?

What does the concept of net investment refer to?

If National Income is $1,000,undistributed corporate profits are $150,corporate taxes are $75,other income not paid out is $100 and personal income is $1,050.What is the value of government transfer payments?

Which of the following should be included in GDP (if reported)?

All of the following,except one,are injections.Which is the exception?

What is the result if Professor Mumbler decorates his own home?

Which of the following summations is GDP equal to?

Why are GDP data criticized as being inaccurate measures of economic welfare?

The two conceptual approaches used to measure GDP are the expenditures approach and the incomes approach.

Use the following,with Year 1 as the base year: -Refer to the information above to answer this question.What is the value of nominal GDP in Year 2?

The Economic Problem

Demand and Supply: an Introduction

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

International Trade

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters

Exam 3: Measuring the Economy 1: GDP and Economic Growth

What is an injection?

What is real GDP?

Are all productive activities not included in the measurement of GDP illegal?

Individuals in the household sector earn income by receiving payment for the goods and services that they sell.

-Refer to the above to answer this question.What is flow (2)?

Which of the following would not cause an increase in nominal GDP?

What is the level of savings in an economy with no government and no international trade,if total factor income is $600 and consumption spending is $480?

Assume that instead of regarding automobile purchases as consumer goods,national income accountants were to categorize them as capital goods? What would be the result?

What does national income measure?

What does the concept of net investment refer to?

If National Income is $1,000,undistributed corporate profits are $150,corporate taxes are $75,other income not paid out is $100 and personal income is $1,050.What is the value of government transfer payments?

Which of the following should be included in GDP (if reported)?

All of the following,except one,are injections.Which is the exception?

What is the result if Professor Mumbler decorates his own home?

Which of the following summations is GDP equal to?

Why are GDP data criticized as being inaccurate measures of economic welfare?

The two conceptual approaches used to measure GDP are the expenditures approach and the incomes approach.

Use the following,with Year 1 as the base year: -Refer to the information above to answer this question.What is the value of nominal GDP in Year 2?

The Economic Problem

Demand and Supply: an Introduction

Measuring the Economy 2: Unemployment and Inflation

Aggregate Demand and Supply

Aggregate Expenditures

Fiscal Policy

Money and Banking

The Money Market and Monetary Policy

International Trade

Exchange Rates and the Balance of Payments

Macroeconomic Policy Revisited

A Walk Through the Twentieth Century and Beyond

Filters