Question 1

Which of the following does not help account for the difference between GDP and National Income (NI)?

Accepted Answer

A) depreciation 
B) net indirect business taxes 
C) personal income taxes 
D) earnings of American owned resources located abroad 
E) earnings of foreign owned resources located in the U.S. 
A) depreciation 
B) net indirect business taxes 
C) personal income taxes 
D) earnings of American owned resources located abroad 
E) earnings of foreign owned resources located in the U.S. C

Question 2

In 2007,if the country of Moolah had consumption of $20 trillion,gross investment of $4 trillion,government purchases of $5 trillion,and GDP of $26 trillion,then net exports must have been

Accepted Answer

A) + $3 trillion 
B) + $29 trillion 
C) - $29 trillion 
D) - $3 trillion 
E) The question cannot be answered without knowing the amount of imports 
A) + $3 trillion 
B) + $29 trillion 
C) - $29 trillion 
D) - $3 trillion 
E) The question cannot be answered without knowing the amount of imports D

Question 3

The difference between Personal Income and Disposable Income is

Accepted Answer

A) personal taxes (e.g.,federal personal income tax) 
B) indirect business taxes 
C) corporate income taxes 
D) payroll taxes paid by employers 
E) Social Security contributions paid by employers 
A) personal taxes (e.g.,federal personal income tax) 
B) indirect business taxes 
C) corporate income taxes 
D) payroll taxes paid by employers 
E) Social Security contributions paid by employers A

Question 4

Imputed rent is included in

Accepted Answer

A) consumption 
B) investment 
C) government spending 
D) national income 
E) indirect business taxes 
A) consumption 
B) investment 
C) government spending 
D) national income 
E) indirect business taxes

Question 5

The reason that indirect business taxes are subtracted from NDP to get NI is that they

Accepted Answer

A) represent income received but not earned 
B) do not represent income to any individual 
C) represent income that we earn but do not receive 
D) represent investment undertaken merely to replace worn-out capital 
E) reflect double counting of intermediate goods 
A) represent income received but not earned 
B) do not represent income to any individual 
C) represent income that we earn but do not receive 
D) represent investment undertaken merely to replace worn-out capital 
E) reflect double counting of intermediate goods

Question 6

Disposable income is commonly referred to as take home pay.

Accepted Answer

A) True 
 B)False

Question 7

National Income is best defined as sum of all income earned by

Accepted Answer

A) American-owned resources,located in the U.S.and abroad 
B) resources located in the U.S. 
C) American-owned resources located abroad 
D) American-owned resources minus income earned by foreign owned resources located in the U.S. 
E) American owned resources in the U.S.minus income earned by American owned resources located abroad 
A) American-owned resources,located in the U.S.and abroad 
B) resources located in the U.S. 
C) American-owned resources located abroad 
D) American-owned resources minus income earned by foreign owned resources located in the U.S. 
E) American owned resources in the U.S.minus income earned by American owned resources located abroad

Question 8

National income is

Accepted Answer

A) GDP minus depreciation 
B) NDP minus depreciation 
C) GDP minus depreciation plus indirect business taxes 
D) GDP plus depreciation minus indirect business taxes 
E) NDP minus indirect business taxes 
A) GDP minus depreciation 
B) NDP minus depreciation 
C) GDP minus depreciation plus indirect business taxes 
D) GDP plus depreciation minus indirect business taxes 
E) NDP minus indirect business taxes

Question 9

What accounts for the difference between GDP and NDP?

Accepted Answer

A) inventory changes 
B) depreciation 
C) undistributed corporate profits 
D) transfer payments 
E) business taxes 
A) inventory changes 
B) depreciation 
C) undistributed corporate profits 
D) transfer payments 
E) business taxes

Question 10

National income captures all income earned by American-owned resources,whether located in the United States or abroad.

Accepted Answer

A) True 
 B)False

Question 11

Personal income minus personal taxes equals disposable income.

Accepted Answer

A) True 
 B)False

Question 12

Factors that explain the differences between National Income and Personal Income include all of the following,except one.Which is the exception?

Accepted Answer

A) Social Security contributions paid by employers 
B) corporate income taxes 
C) undistributed corporate profits 
D) government and business transfers 
E) indirect business taxes 
A) Social Security contributions paid by employers 
B) corporate income taxes 
C) undistributed corporate profits 
D) government and business transfers 
E) indirect business taxes

Question 13

Which one of the following is not included in National Income?

Accepted Answer

A) employee compensation 
B) proprietors' income 
C) rental incomes of persons 
D) corporate profits 
E) gross interest income 
A) employee compensation 
B) proprietors' income 
C) rental incomes of persons 
D) corporate profits 
E) gross interest income

Question 14

Personal income is

Accepted Answer

A) NDP minus indirect business taxes 
B) NDP minus depreciation minus taxes 
C) national income minus taxes 
D) national income plus income received but not earned minus income earned but not received 
E) national income minus income received but not earned plus income earned but not received 
A) NDP minus indirect business taxes 
B) NDP minus depreciation minus taxes 
C) national income minus taxes 
D) national income plus income received but not earned minus income earned but not received 
E) national income minus income received but not earned plus income earned but not received

Question 15

Disposable Income is Personal Income minus personal taxes.

Accepted Answer

A) True 
 B)False

Question 16

Disposable income is personal income after taxes.

Accepted Answer

A) True 
 B)False

Question 17

Income earned but not received refers to

Accepted Answer

A) government transfers,business transfers,and social insurance taxes 
B) government transfers,social insurance taxes,and corporate income taxes 
C) business transfers,net personal interest income,and rental income 
D) social insurance taxes,undistributed corporate profits,and corporate income taxes 
E) business transfers,social insurance taxes,and corporate profits 
A) government transfers,business transfers,and social insurance taxes 
B) government transfers,social insurance taxes,and corporate income taxes 
C) business transfers,net personal interest income,and rental income 
D) social insurance taxes,undistributed corporate profits,and corporate income taxes 
E) business transfers,social insurance taxes,and corporate profits

Question 18

The income approach to GDP reveals that compensation of employees (i.e.,wages and salaries)is larger than profits.

Accepted Answer

A) True 
 B)False

Question 19

Disposable income is

Accepted Answer

A) personal income minus personal taxes 
B) national income plus transfer payments 
C) NDP minus personal income tax 
D) personal income minus transfer payments 
E) national income minus transfer payments plus taxes 
A) personal income minus personal taxes 
B) national income plus transfer payments 
C) NDP minus personal income tax 
D) personal income minus transfer payments 
E) national income minus transfer payments plus taxes

Question 20

Personal income equals national income minus personal taxes.

Accepted Answer

A) True 
 B)False

Exam 23: National Income Accounts

Which of the following does not help account for the difference between GDP and National Income (NI)?

In 2007,if the country of Moolah had consumption of $20 trillion,gross investment of $4 trillion,government purchases of $5 trillion,and GDP of $26 trillion,then net exports must have been

The difference between Personal Income and Disposable Income is

Imputed rent is included in

The reason that indirect business taxes are subtracted from NDP to get NI is that they

Disposable income is commonly referred to as take home pay.

National Income is best defined as sum of all income earned by

National income is

What accounts for the difference between GDP and NDP?

National income captures all income earned by American-owned resources,whether located in the United States or abroad.

Personal income minus personal taxes equals disposable income.

Factors that explain the differences between National Income and Personal Income include all of the following,except one.Which is the exception?

Which one of the following is not included in National Income?

Personal income is

Disposable Income is Personal Income minus personal taxes.

Disposable income is personal income after taxes.

Income earned but not received refers to

The income approach to GDP reveals that compensation of employees (i.e.,wages and salaries)is larger than profits.

Disposable income is

Personal income equals national income minus personal taxes.

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Economic Tools and Economics Systems

Economic Decision Makers

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Introduction to Macroeconomics

Tracking the Useconomy

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Baggregate Expenditure and Aggregate Demand

Aggregate Supply

Fiscal Policy

Federal Budgets and Public Policy

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Macro Policy Debate: Active or Passive

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Externalities and the Environment

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Economic Development

understanding Graphs

The Algebra of Demand-Side Equilibrium

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