Question 1

GDP is:

Accepted Answer

A) the total value of all consumer expenditures within a given period. 
B) national income after taxes. 
C) the total value of all final goods and services plus intermediate goods and services produced domestically within a given period. 
D) the value of all final goods and services produced domestically within a given period. 
E) the total value of all final goods and services minus the value of intermediate goods and services produced domestically within a given period. 
A) the total value of all consumer expenditures within a given period. 
B) national income after taxes. 
C) the total value of all final goods and services plus intermediate goods and services produced domestically within a given period. 
D) the value of all final goods and services produced domestically within a given period. 
E) the total value of all final goods and services minus the value of intermediate goods and services produced domestically within a given period.

Question 2

The total dollar value of purchases in the economy is far larger than GDP primarily because:

Accepted Answer

A) GDP ignores taxes. 
B) GDP excludes the value of intermediate goods exchanged. 
C) GDP excludes the output from foreigners working in America. 
D) GDP ignores production in the home 
A) GDP ignores taxes. 
B) GDP excludes the value of intermediate goods exchanged. 
C) GDP excludes the output from foreigners working in America. 
D) GDP ignores production in the home

Question 3

Exhibit 12-A
GDP - Expenditure Approach  
-Refer to Exhibit 12-A.Investments (I) for the year in question is:

Accepted Answer

A) $2,000 billion. 
B) $4,000 billion. 
C) $200 billion. 
D) $1,800 billion. 
A) $2,000 billion. 
B) $4,000 billion. 
C) $200 billion. 
D) $1,800 billion.

Question 4

Improvements in and greater stocks of land, labor, capital, and entrepreneurial activity will shift the production possibilities curve:

Accepted Answer

A) outward, such that more goods and services can be produced. 
B) outward, such that the cost-of-living rises. 
C) inward, such that the marketplace experiences a decrease in price and output levels. 
D) inward, because more resources will be used up and not renewed. 
A) outward, such that more goods and services can be produced. 
B) outward, such that the cost-of-living rises. 
C) inward, such that the marketplace experiences a decrease in price and output levels. 
D) inward, because more resources will be used up and not renewed.

Question 5

The goods and services that are used in the production of other goods and services are called:

Accepted Answer

A) gross domestic goods. 
B) intermediate goods. 
C) final goods. 
D) ultimate goods. 
E) preliminary goods. 
A) gross domestic goods. 
B) intermediate goods. 
C) final goods. 
D) ultimate goods. 
E) preliminary goods.

Question 6

Which of the following statements is not correct?

Accepted Answer

A) Economic growth is best measured by the annual percentage change in nominal GDP per capita. 
B) An economy producing along the production possibilities curve is operating at its potential output. 
C) Economic growth is a crucial determinant of people's well-being. 
D) If the quality of labor improves, an economy's production possibilities curve will shift outward. 
A) Economic growth is best measured by the annual percentage change in nominal GDP per capita. 
B) An economy producing along the production possibilities curve is operating at its potential output. 
C) Economic growth is a crucial determinant of people's well-being. 
D) If the quality of labor improves, an economy's production possibilities curve will shift outward.

Question 7

If productivity of an economy increases then:

Accepted Answer

A) the amount of goods and services produced by a worker per hour increases. 
B) the population of the labor force increases. 
C) the real GDP per capita decreases. 
D) the population of labor force decreases. 
A) the amount of goods and services produced by a worker per hour increases. 
B) the population of the labor force increases. 
C) the real GDP per capita decreases. 
D) the population of labor force decreases.

Question 8

Personal income includes:

Accepted Answer

A) income received in the form of transfer payments. 
B) wages and salaries. 
C) interest earnings on bonds. 
D) dividend earnings on stocks. 
E) all of the above. 
A) income received in the form of transfer payments. 
B) wages and salaries. 
C) interest earnings on bonds. 
D) dividend earnings on stocks. 
E) all of the above.

Question 9

GDP that has been adjusted for changes in the price level is called:

Accepted Answer

A) nominal GDP. 
B) real GDP. 
C) personal income. 
D) net GDP. 
E) net national income. 
A) nominal GDP. 
B) real GDP. 
C) personal income. 
D) net GDP. 
E) net national income.

Question 10

The expenditure approach to GDP accounting includes:

Accepted Answer

A) consumption. 
B) investment. 
C) government purchases. 
D) net exports. 
E) all of the above. 
A) consumption. 
B) investment. 
C) government purchases. 
D) net exports. 
E) all of the above.

Question 11

Education would be considered investments in:

Accepted Answer

A) physical capital 
B) financial capital 
C) human capital 
D) all of the above 
E) none of the above. 
A) physical capital 
B) financial capital 
C) human capital 
D) all of the above 
E) none of the above.

Question 12

Which of the following is false?

Accepted Answer

A) Generally speaking, higher levels of saving will lead to higher levels of investment and capital formation and, therefore, to greater economic growth. 
B) If there was an increase in the quantity of physical capital in a country at the same time that the quantity or quality of labor resources used rose, that country would experience economic growth as a result. 
C) Investment alone does not guarantee economic growth, which hinges importantly on the quality and the type of investment as well. 
D) Economic growth rates tend to be higher in countries where the government enforces property rights. 
E) None of the above are false; all are true. 
A) Generally speaking, higher levels of saving will lead to higher levels of investment and capital formation and, therefore, to greater economic growth. 
B) If there was an increase in the quantity of physical capital in a country at the same time that the quantity or quality of labor resources used rose, that country would experience economic growth as a result. 
C) Investment alone does not guarantee economic growth, which hinges importantly on the quality and the type of investment as well. 
D) Economic growth rates tend to be higher in countries where the government enforces property rights. 
E) None of the above are false; all are true.

Question 13

Which of the following will not contribute to increasing the stock of capital of a nation?

Accepted Answer

A) an increase in savings 
B) a reduction in taxes on capital gains and stock dividends 
C) a lack of enforcement of private property rights 
D) the subsidization of higher education 
A) an increase in savings 
B) a reduction in taxes on capital gains and stock dividends 
C) a lack of enforcement of private property rights 
D) the subsidization of higher education

Question 14

Sergei has developed a new fat substitute that has no calories and produces no side effects.In order for him to be encouraged to bring this innovation to the marketplace he is likely to want which of the following the most?

Accepted Answer

A) time to be able to thoroughly test the fat substitute 
B) an ample supply of capital to start the manufacturing process 
C) a trademark 
D) a patent 
A) time to be able to thoroughly test the fat substitute 
B) an ample supply of capital to start the manufacturing process 
C) a trademark 
D) a patent

Question 15

Table 12-A
 $$\begin{array} { | l | c | c | } 
\hline & \begin{array} { c } 
\text { Growth Rate } \
\text { (\%) }
\end{array} & \begin{array} { c } 
\text { Years to double } \
\text { econony }
\end{array} \
\hline \text { Nation A } & ? & 14 \
\hline \text { Nation B } & 10 & ? \
\hline \text { Nation C } & ? & 35 \
\hline \text { Nation D } & 7 & ? \
\hline
\end{array}$$
-Refer to Table 12-A.Nation B is expected to double its output in:

Accepted Answer

A) 5 years. 
B) 7 years. 
C) 10 years. 
D) 14 years. 
A) 5 years. 
B) 7 years. 
C) 10 years. 
D) 14 years.

Question 16

Exhibit 12-A
GDP - Expenditure Approach  
-Refer to Exhibit 12-A.Government purchases (G) for the year in question is:

Accepted Answer

A) $1,350 billion. 
B) $3,400 billion. 
C) $2,100 billion. 
D) $2,550 billion. 
A) $1,350 billion. 
B) $3,400 billion. 
C) $2,100 billion. 
D) $2,550 billion.

Question 17

A price index can be constructed by:

Accepted Answer

A) dividing the value of a market basket by the rate of inflation. 
B) dividing the current-year value of a market basket by the base-year value of the same market basket and multiplying by 100. 
C) multiplying the value of a market basket by the rate of inflation. 
D) multiplying the current-year value of a market basket by the base-year value of the same market basket and dividing by 100. 
A) dividing the value of a market basket by the rate of inflation. 
B) dividing the current-year value of a market basket by the base-year value of the same market basket and multiplying by 100. 
C) multiplying the value of a market basket by the rate of inflation. 
D) multiplying the current-year value of a market basket by the base-year value of the same market basket and dividing by 100.

Question 18

Changes in the growth rate of real GDP per capita do not reflect which of the following?

Accepted Answer

A) changes in the total production of final goods in the economy 
B) changes in the production of final services in the economy 
C) changes in the distribution of income 
D) changes in the size of the population 
A) changes in the total production of final goods in the economy 
B) changes in the production of final services in the economy 
C) changes in the distribution of income 
D) changes in the size of the population

Question 19

Household income after taxes is called:

Accepted Answer

A) national income. 
B) gross domestic product. 
C) disposable personal income. 
D) gross national product. 
E) personal income. 
A) national income. 
B) gross domestic product. 
C) disposable personal income. 
D) gross national product. 
E) personal income.

Question 20

Government purchases, under the expenditure approach to GDP accounting, do not include:

Accepted Answer

A) state government purchases of plumbing services. 
B) Social Security benefit payments to retirees. 
C) the salaries of military officers. 
D) federal government purchases of computers. 
A) state government purchases of plumbing services. 
B) Social Security benefit payments to retirees. 
C) the salaries of military officers. 
D) federal government purchases of computers.

GDP is:

The total dollar value of purchases in the economy is far larger than GDP primarily because:

Exhibit 12-A GDP - Expenditure Approach -Refer to Exhibit 12-A.Investments (I) for the year in question is:

Improvements in and greater stocks of land, labor, capital, and entrepreneurial activity will shift the production possibilities curve:

The goods and services that are used in the production of other goods and services are called:

Which of the following statements is not correct?

If productivity of an economy increases then:

Personal income includes:

GDP that has been adjusted for changes in the price level is called:

The expenditure approach to GDP accounting includes:

Education would be considered investments in:

Which of the following is false?

Which of the following will not contribute to increasing the stock of capital of a nation?

Sergei has developed a new fat substitute that has no calories and produces no side effects.In order for him to be encouraged to bring this innovation to the marketplace he is likely to want which of the following the most?

Table 12-A Growth Rate (\%) Years to double econony Nation A ? 14 Nation B 10 ? Nation C ? 35 Nation D 7 ? -Refer to Table 12-A.Nation B is expected to double its output in:

Exhibit 12-A GDP - Expenditure Approach -Refer to Exhibit 12-A.Government purchases (G) for the year in question is:

A price index can be constructed by:

Changes in the growth rate of real GDP per capita do not reflect which of the following?

Household income after taxes is called:

Government purchases, under the expenditure approach to GDP accounting, do not include:

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

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Exam 12: Economic Growth

GDP is:

The total dollar value of purchases in the economy is far larger than GDP primarily because:

Exhibit 12-A GDP - Expenditure Approach -Refer to Exhibit 12-A.Investments (I) for the year in question is:

Improvements in and greater stocks of land, labor, capital, and entrepreneurial activity will shift the production possibilities curve:

The goods and services that are used in the production of other goods and services are called:

Which of the following statements is not correct?

If productivity of an economy increases then:

Personal income includes:

GDP that has been adjusted for changes in the price level is called:

The expenditure approach to GDP accounting includes:

Education would be considered investments in:

Which of the following is false?

Which of the following will not contribute to increasing the stock of capital of a nation?

Sergei has developed a new fat substitute that has no calories and produces no side effects.In order for him to be encouraged to bring this innovation to the marketplace he is likely to want which of the following the most?

Table 12-A Growth Rate (\%) Years to double econony Nation A ? 14 Nation B 10 ? Nation C ? 35 Nation D 7 ? -Refer to Table 12-A.Nation B is expected to double its output in:

Exhibit 12-A GDP - Expenditure Approach -Refer to Exhibit 12-A.Government purchases (G) for the year in question is:

A price index can be constructed by:

Changes in the growth rate of real GDP per capita do not reflect which of the following?

Household income after taxes is called:

Government purchases, under the expenditure approach to GDP accounting, do not include:

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

Filters