Exam 10: Measuring a Nations Income: The Measurement of GDP

AA Appliances sells refrigerators.In 2015 it added $100,000 to its inventory.$10,000 of this addition was from used refrigerators,and the remaining $90,000 was from their purchases of newly manufactured refrigerators.How much of AA's inventory is included in 2015 GDP?

Darin grows and sells marijuana to Jennifer.Thomas is an organic farmer who sells broccoli to Jennifer.Marijuana is an illegal good and broccoli is a legal good.Assume that if Jennifer marries either,they give her what they used to sell her.Which of the following statements is consistent with the way GDP is computed?

Martin,a U.S.citizen,travels to Mexico and buys a newly manufactured motorcycle made there.His purchase is included in

A steel company sells some steel to a bicycle company for $150.The bicycle company uses the steel to produce a bicycle,which it sells for $250.Taken together,these two transactions contribute

Joe and Jim purchase vegetables at a grocery store,but Jim also grows vegetables in his back yard.Regarding these two practices,which of the following statements is correct?

National income is defined as

Gross domestic product adds together many different kinds of goods and services into a single measure of the value of economic activity.To do this,GDP makes use of

Grapes are considered intermediate goods

A statistical discrepancy

The statistical discrepancy that regularly arises in national income accounting refers to the slight difference between

In early 2010 Molly paid $200,000 for a house built in 2000.She spent $30,000 on new materials to remodel the house.Although Molly lived in the house after she remodeled it,its rental value rose.Which of the following contributed to real GDP in 2010?

The value of the housing services provided by the economy's owner-occupied houses is

Suppose there are only two firms in an economy: Cowhide,Inc.produces leather and sells it to Couches,Inc. ,which produces and sells leather furniture.With each $1,000 worth of leather that it buys from Cowhide,Inc. ,Couches,Inc.produces a couch and sells it for $2,600.Neither firm had any inventory at the beginning of 2015.During that year,Cowhide produced enough leather for 25 couches.Couches,Inc.bought 80% of that leather for $20,000 and promised to buy the remaining 20% for $5,000 in 2016.Couches,Inc.produced 20 couches during 2015 and sold each one during that year for $2,600.What was the economy's GDP for 2015?

Tim mows the yard for his neighbors.He spends $1 on gas and charges them $20 for each lawn he mows.What's the total contribution to GDP each time Tim mows a yard?

Which government entity computes U.S.GDP every three months?

Which of the following is not included in GDP?

In 2014,a farmer grows and sells $3 million worth of corn to Big Flakes Cereal Company.Big Flakes Cereal Company produces $8 million worth of cereal in 2014,with sales to households during the year of $7 million.The unsold $1 million worth of cereal remains in Big Flake Cereal Company's inventory at the end of 2014.The transactions just described contribute how much to GDP for 2014?