Question 1

Disposable income is

Accepted Answer

A)  the total income earned by a nation's permanent residents. 
B)  the total income earned by a nation's residents in the production of goods and services. 
C)  the income that households and non-corporate businesses receive. 
D)  the income that households and businesses have remaining after satisfying their obligations to the government. 
A)  the total income earned by a nation's permanent residents. 
B)  the total income earned by a nation's residents in the production of goods and services. 
C)  the income that households and non-corporate businesses receive. 
D)  the income that households and businesses have remaining after satisfying their obligations to the government.

Question 2

An American retailer purchased 500 pairs of shoes from a company in Thailand in the second quarter of 2016 but does not sell them to a consumer until the third quarter of 2016. Which of the following components of U.S. GDP is affected by this transaction in the third quarter of 2016?

Accepted Answer

A)  consumption, investment and imports 
B)  only consumption and investment 
C)  only consumption and imports 
D)  only investment and imports 
A)  consumption, investment and imports 
B)  only consumption and investment 
C)  only consumption and imports 
D)  only investment and imports

Question 3

Table 23-10
A hypothetical country of Lahland produces only movies and popcorn. Quantities and prices of these goods for the last several years are shown below. The base year is 2015 .
  
-Refer to Table 23-10. In which year was this country's nominal GDP highest?

Accepted Answer

A)  2014 
B)  2015 
C)  2016 
D)  2017 
A)  2014 
B)  2015 
C)  2016 
D)  2017

Question 4

Which of the following is not included in GDP?

Accepted Answer

A)  a can of bug spray 
B)  the services of an exterminator 
C)  the honey produced and sold by a beekeeper 
D)  All of the above are included in GDP. 
A)  a can of bug spray 
B)  the services of an exterminator 
C)  the honey produced and sold by a beekeeper 
D)  All of the above are included in GDP.

Question 5

Which of the following is included in government purchases?

Accepted Answer

A)  unemployment benefits a state pays 
B)  Social Security payments the U.S. government makes 
C)  the services of a U.S. government attorney valued at the cost of her salary 
D)  All of the above are correct. 
A)  unemployment benefits a state pays 
B)  Social Security payments the U.S. government makes 
C)  the services of a U.S. government attorney valued at the cost of her salary 
D)  All of the above are correct.

Question 6

Table 23-10
A hypothetical country of Lahland produces only movies and popcorn. Quantities and prices of these goods for the last several years are shown below. The base year is 2015 .
  
-Refer to Table 23-10. What was this country's nominal GDP in 2014?

Accepted Answer

A)  $9,500 
B)  $10,000 
C)  $10,200 
D)  $10,500 
A)  $9,500 
B)  $10,000 
C)  $10,200 
D)  $10,500

Question 7

What are exports, and how are they different from imports?

Accepted Answer

Exports are domestically produ

Question 8

If the value of an economy's imports exceeds the value of that economy's exports, then net exports is a negative number.

Accepted Answer

A) True 
 B)False

Question 9

In 2012, GDP per person in the United States was almost

Accepted Answer

A)  $14,000. 
B)  $36,000. 
C)  $46,000 
D)  $50,000 
A)  $14,000. 
B)  $36,000. 
C)  $46,000 
D)  $50,000

Question 10

Suppose a country has government expenditures of $3,500, taxes of $2,200, consumption of $9,000, exports of $2,500, imports of $2,700, transfer payments of $750, capital depreciation of $800, and investment of $3,000. GDP equals

Accepted Answer

A)  $24,450. 
B)  $11,550. 
C)  $15,300. 
D)  $20,700. 
A)  $24,450. 
B)  $11,550. 
C)  $15,300. 
D)  $20,700.

Question 11

The residents of Ireland earn $200 million of income from abroad. Residents of other countries earn $300 million in Ireland. Therefore, Ireland's

Accepted Answer

A)  net factor payments from abroad are positive, and its GDP is larger than its GNP. 
B)  net factor payments from abroad are positive, and its GNP is larger than its GDP. 
C)  net factor payments from abroad are negative, and its GDP is larger than its GNP. 
D)  net factor payments from abroad are negative, and its GNP is larger than its GDP. 
A)  net factor payments from abroad are positive, and its GDP is larger than its GNP. 
B)  net factor payments from abroad are positive, and its GNP is larger than its GDP. 
C)  net factor payments from abroad are negative, and its GDP is larger than its GNP. 
D)  net factor payments from abroad are negative, and its GNP is larger than its GDP.

Question 12

When an Egyptian firm purchases a cement mixer from Slovakia,

Accepted Answer

A)  Egyptian investment does not change, Egyptian net exports decrease, Egyptian GDP decreases, Slovakian net exports increase, and Slovakian GDP increases. 
B)  Egyptian investment increases, Egyptian net exports decrease, Egyptian GDP is unaffected, Slovakian net exports increase, and Slovakian GDP increases. 
C)  Egyptian investment decreases, Egyptian net exports increase, Egyptian GDP is unaffected, Slovakian net exports decrease, and Slovakian GDP decreases. 
D)  Egyptian investment increases, Egyptian net exports do not change, Egyptian GDP increases, Slovakian net exports do not change, and Slovakian GDP is unaffected. 
A)  Egyptian investment does not change, Egyptian net exports decrease, Egyptian GDP decreases, Slovakian net exports increase, and Slovakian GDP increases. 
B)  Egyptian investment increases, Egyptian net exports decrease, Egyptian GDP is unaffected, Slovakian net exports increase, and Slovakian GDP increases. 
C)  Egyptian investment decreases, Egyptian net exports increase, Egyptian GDP is unaffected, Slovakian net exports decrease, and Slovakian GDP decreases. 
D)  Egyptian investment increases, Egyptian net exports do not change, Egyptian GDP increases, Slovakian net exports do not change, and Slovakian GDP is unaffected.

Question 13

Recently, the U.S. national income accounts have switched to calling government purchases

Accepted Answer

A)  government spending and transfer payments. 
B)  transfer payments and gross investment by government. 
C)  government consumption expenditure and gross investment. 
D)  government wages, salaries, and investment expenditure. 
A)  government spending and transfer payments. 
B)  transfer payments and gross investment by government. 
C)  government consumption expenditure and gross investment. 
D)  government wages, salaries, and investment expenditure.

Question 14

An increase in nominal U.S. GDP necessarily implies that the United States is producing a larger output of goods and services.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is included in the investment component of GDP?

Accepted Answer

A)  Elaine pays her college tuition bill. 
B)  John's law firm buys him a new computer. 
C)  Laura buys a bond that McDonald's sells to raise funds. 
D)  All of the above are correct. 
A)  Elaine pays her college tuition bill. 
B)  John's law firm buys him a new computer. 
C)  Laura buys a bond that McDonald's sells to raise funds. 
D)  All of the above are correct.

Question 16

Changes in nominal GDP reflect

Accepted Answer

A)  only changes in prices. 
B)  only changes in the amounts being produced. 
C)  both changes in prices and changes in the amounts being produced. 
D)  neither changes in prices nor changes in the amounts being produced. 
A)  only changes in prices. 
B)  only changes in the amounts being produced. 
C)  both changes in prices and changes in the amounts being produced. 
D)  neither changes in prices nor changes in the amounts being produced.

Question 17

Which of the following statements about GDP is correct?

Accepted Answer

A)  Nominal GDP values production at current prices, whereas real GDP values production at constant prices. 
B)  Nominal GDP values production at constant prices, whereas real GDP values production at current prices. 
C)  Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process. 
D)  Nominal GDP values production at the cost of the resources used in the production process, whereas real GDP values production at market prices. 
A)  Nominal GDP values production at current prices, whereas real GDP values production at constant prices. 
B)  Nominal GDP values production at constant prices, whereas real GDP values production at current prices. 
C)  Nominal GDP values production at market prices, whereas real GDP values production at the cost of the resources used in the production process. 
D)  Nominal GDP values production at the cost of the resources used in the production process, whereas real GDP values production at market prices.

Question 18

Gasoline is considered a final good if it is sold by a

Accepted Answer

A)  gasoline station to a bus company that operates a bus route between San Francisco and Los Angeles. 
B)  pipeline operator to a gasoline station in San Francisco. 
C)  gasoline station to a motorist in Los Angeles. 
D)  All of the above are correct. 
A)  gasoline station to a bus company that operates a bus route between San Francisco and Los Angeles. 
B)  pipeline operator to a gasoline station in San Francisco. 
C)  gasoline station to a motorist in Los Angeles. 
D)  All of the above are correct.

Question 19

In 2011 a country had a real GDP of $13.89 trillion and GDP deflator of 110. In 2012 it had a nominal GDP of $17.8 trillion and real GDP of 14.24 trillion. What is the rate of inflation in 2012?

Accepted Answer

The answer of In 2011 a country had a real...

Question 20

Table 23-5
The country of Caspir produces only cereal and milk. Quantities and prices of these goods for the last several years are shown below. The base year is 2015.
Prices and Quantities
  
-Refer to Table 23-5. In 2017, this country's

Accepted Answer

A)  real GDP was $900, and the GDP deflator was 138.9. 
B)  real GDP was $1250, and the GDP deflator was 128.0. 
C)  real GDP was $900, and the GDP deflator was 128.0. 
D)  real GDP was $1250, and the GDP deflator was 138.9. 
A)  real GDP was $900, and the GDP deflator was 138.9. 
B)  real GDP was $1250, and the GDP deflator was 128.0. 
C)  real GDP was $900, and the GDP deflator was 128.0. 
D)  real GDP was $1250, and the GDP deflator was 138.9.

Exam 10: Measuring a Nations Income

Disposable income is

An American retailer purchased 500 pairs of shoes from a company in Thailand in the second quarter of 2016 but does not sell them to a consumer until the third quarter of 2016. Which of the following components of U.S. GDP is affected by this transaction in the third quarter of 2016?

Table 23-10 A hypothetical country of Lahland produces only movies and popcorn. Quantities and prices of these goods for the last several years are shown below. The base year is 2015 . -Refer to Table 23-10. In which year was this country's nominal GDP highest?

Which of the following is not included in GDP?

Which of the following is included in government purchases?

Table 23-10 A hypothetical country of Lahland produces only movies and popcorn. Quantities and prices of these goods for the last several years are shown below. The base year is 2015 . -Refer to Table 23-10. What was this country's nominal GDP in 2014?

What are exports, and how are they different from imports?

If the value of an economy's imports exceeds the value of that economy's exports, then net exports is a negative number.

In 2012, GDP per person in the United States was almost

Suppose a country has government expenditures of $3,500, taxes of $2,200, consumption of $9,000, exports of $2,500, imports of $2,700, transfer payments of $750, capital depreciation of $800, and investment of $3,000. GDP equals

The residents of Ireland earn $200 million of income from abroad. Residents of other countries earn $300 million in Ireland. Therefore, Ireland's

When an Egyptian firm purchases a cement mixer from Slovakia,

Recently, the U.S. national income accounts have switched to calling government purchases

An increase in nominal U.S. GDP necessarily implies that the United States is producing a larger output of goods and services.

Which of the following is included in the investment component of GDP?

Changes in nominal GDP reflect

Which of the following statements about GDP is correct?

Gasoline is considered a final good if it is sold by a

In 2011 a country had a real GDP of $13.89 trillion and GDP deflator of 110. In 2012 it had a nominal GDP of $17.8 trillion and real GDP of 14.24 trillion. What is the rate of inflation in 2012?

Table 23-5 The country of Caspir produces only cereal and milk. Quantities and prices of these goods for the last several years are shown below. The base year is 2015. Prices and Quantities -Refer to Table 23-5. In 2017, this country's

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: the Costs of Taxation

Application: International Trade

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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