Question 1

In order to measure gross domestic product,we can follow

Accepted Answer

A) only one approach: the circular flow approach. 
B) only one approach: the national accounts approach. 
C) two approaches: the expenditure approach and the income approach. 
D) three approaches: the expenditure approach,the income approach,and the production approach. 
E) three approaches: the expenditure approach,the income approach,and the market-based approach. 
A) only one approach: the circular flow approach. 
B) only one approach: the national accounts approach. 
C) two approaches: the expenditure approach and the income approach. 
D) three approaches: the expenditure approach,the income approach,and the production approach. 
E) three approaches: the expenditure approach,the income approach,and the market-based approach. C

Question 2

GDP is equal to the ________ value of all the final goods and services produced within a country in a given period of time.

Accepted Answer

A) production 
B) market 
C) wholesale 
D) retail 
E) typical 
A) production 
B) market 
C) wholesale 
D) retail 
E) typical B

Question 3

Define and distinguish between final goods and intermediate goods.

Accepted Answer

Final goods are those goods that are purchased by their final user.Essentially,these goods (and services)have been completed and do not need to go through further processes of completion.Examples of final goods include restaurant meals,lamps,railroad engines,and books.Intermediate goods and services are goods or services produced by one firm,bought by another,and then used as a component in the manufacture of another good or service.Basically,intermediate goods and services are used as a part of another good or service.Lumber used by a carpenter to build a table is an example of an intermediate good.

Question 4

Gross Domestic Product measures the

Accepted Answer

A) quantity of the goods and services produced in a given year,listed item by item,within a country. 
B) income of the business sector within a country. 
C) market value of the final goods and services produced in a given year within a country. 
D) measures the market value of the domestic labor in a given year within a country. 
E) market value of the final goods and services consumed by households in a given year within a country. 
A) quantity of the goods and services produced in a given year,listed item by item,within a country. 
B) income of the business sector within a country. 
C) market value of the final goods and services produced in a given year within a country. 
D) measures the market value of the domestic labor in a given year within a country. 
E) market value of the final goods and services consumed by households in a given year within a country.

Question 5

As measured,GDP omits which of the following?
I.Illegal sales of goods and services
Ii.Changes in the amount of leisure time
Iii.Household production of goods and services

Accepted Answer

A) i only 
B) i and ii 
C) ii and iii 
D) i and iii 
E) i,ii,and iii 
A) i only 
B) i and ii 
C) ii and iii 
D) i and iii 
E) i,ii,and iii

Question 6

-The table gives data for a nation.What is the amount of the country's GDP?

Accepted Answer

A) $6,000 billion 
B) $6,200 billion 
C) $6,600 billion 
D) $6,900 billion 
E) $5,800 billion 
A) $6,000 billion 
B) $6,200 billion 
C) $6,600 billion 
D) $6,900 billion 
E) $5,800 billion

Question 7

Total income in a country in 2012 is $780 billion.Total expenditure in the country

Accepted Answer

A) cannot be determined. 
B) is greater than $780 billion. 
C) is $780 billion. 
D) is less than $780 billion. 
E) is either less than or equal to $780 billion. 
A) cannot be determined. 
B) is greater than $780 billion. 
C) is $780 billion. 
D) is less than $780 billion. 
E) is either less than or equal to $780 billion.

Question 8

Which of the following is true regarding the measurement of GDP?

Accepted Answer

A) Wages and profit income are used in the income approach to GDP. 
B) Wages and consumption are used in the expenditure approach to GDP. 
C) Consumption and investment are used in the income approach to GDP. 
D) Government expenditure is only counted in the income approach to GDP. 
E) Investment and wages are expenditures,and are therefore are used in the expenditure approach to GDP. 
A) Wages and profit income are used in the income approach to GDP. 
B) Wages and consumption are used in the expenditure approach to GDP. 
C) Consumption and investment are used in the income approach to GDP. 
D) Government expenditure is only counted in the income approach to GDP. 
E) Investment and wages are expenditures,and are therefore are used in the expenditure approach to GDP.

Question 9

How are final goods and services valued when measuring nominal GDP?

Accepted Answer

A) at current market prices 
B) at base year prices 
C) at foreign exchange parity 
D) at factor market prices 
E) at producer cost 
A) at current market prices 
B) at base year prices 
C) at foreign exchange parity 
D) at factor market prices 
E) at producer cost

Question 10

-Using the information in the table above,what does GDP equal?

Accepted Answer

A) $365 billion 
B) $350 billion 
C) $650 billion 
D) $380 billion 
E) GDP cannot be calculated without information on the amount of investment. 
A) $365 billion 
B) $350 billion 
C) $650 billion 
D) $380 billion 
E) GDP cannot be calculated without information on the amount of investment.

Question 11

Bob's Funky T-shirts began the year with 1,000 shirts in inventory,produced 10,000 shirts during the year and ended the year with 1,100 shirts in inventory.The 100 shirts added to his inventory will be classified as

Accepted Answer

A) consumption expenditure. 
B) investment. 
C) net exports of goods and services. 
D) exports of goods and services. 
E) nondurable consumption goods. 
A) consumption expenditure. 
B) investment. 
C) net exports of goods and services. 
D) exports of goods and services. 
E) nondurable consumption goods.

Question 12

Explain why the purchase and sale of used goods and of financial assets are not included in the calculation of GDP even though transactions in these items amount to billions of dollars daily.

Accepted Answer

GDP measures the value of the goods and

Question 13

Gross Domestic Product is defined to be the market value of all the final goods and services produced during a given time period

Accepted Answer

A) within a country. 
B) within and outside a country by that country's citizens. 
C) by citizens of the country,regardless of their place of residence. 
D) by only legal residents of the country. 
E) within a county minus the market value of all the final goods and services produced by that country's citizens outside the country. 
A) within a country. 
B) within and outside a country by that country's citizens. 
C) by citizens of the country,regardless of their place of residence. 
D) by only legal residents of the country. 
E) within a county minus the market value of all the final goods and services produced by that country's citizens outside the country.

Question 14

The largest expenditure category in the United States is

Accepted Answer

A) consumption expenditure. 
B) investment. 
C) government expenditure on goods and services. 
D) net exports of goods and services. 
E) wages. 
A) consumption expenditure. 
B) investment. 
C) government expenditure on goods and services. 
D) net exports of goods and services. 
E) wages.

Question 15

Which of the following goods and services are omitted from GDP?

Accepted Answer

A) household production 
B) capital goods 
C) expenditure on resources used to protect the environment 
D) government weather satellites 
E) services such as hair styling 
A) household production 
B) capital goods 
C) expenditure on resources used to protect the environment 
D) government weather satellites 
E) services such as hair styling

Question 16

What is the relationship shown by the circular flow among income,total expenditure,and GDP?

Accepted Answer

They are all equal.The value of producti

Question 17

The expenditure approach to measuring GDP is based on summing

Accepted Answer

A) wages,interest,rent,and profit. 
B) each industry's production. 
C) the total values of final goods,intermediate goods and services,used goods,and financial assets. 
D) consumption expenditure,investment,government expenditure on goods and services,and net exports of goods and services. 
E) consumption expenditure,investment,government expenditure on goods and services,and net exports of goods and services minus wages,interest,rent,and profit. 
A) wages,interest,rent,and profit. 
B) each industry's production. 
C) the total values of final goods,intermediate goods and services,used goods,and financial assets. 
D) consumption expenditure,investment,government expenditure on goods and services,and net exports of goods and services. 
E) consumption expenditure,investment,government expenditure on goods and services,and net exports of goods and services minus wages,interest,rent,and profit.

Question 18

Comparing nominal GDP of 2012 to nominal GDP of twenty years ago

Accepted Answer

A) is an inaccurate measure of the change in total production. 
B) has no economic meaning. 
C) will be an accurate measure of the change in total production. 
D) determines the extent to which the cost of living changed. 
E) cannot be done because the two GDP measures use different prices. 
A) is an inaccurate measure of the change in total production. 
B) has no economic meaning. 
C) will be an accurate measure of the change in total production. 
D) determines the extent to which the cost of living changed. 
E) cannot be done because the two GDP measures use different prices.

Question 19

The U.S.economy is experiencing falling output,falling employment,falling incomes and rising unemployment.These conditions best describe a business cycle

Accepted Answer

A) expansion. 
B) peak. 
C) trend. 
D) recession. 
E) trough. 
A) expansion. 
B) peak. 
C) trend. 
D) recession. 
E) trough.

Question 20

-The table gives data on the production and prices in a small economy.Use 2012 as the base period.Using the chained-price method,what is the growth rate of real GDP from 2012 to 2013?

Accepted Answer

To calculate the growth rate,it is neces

In order to measure gross domestic product,we can follow

GDP is equal to the ________ value of all the final goods and services produced within a country in a given period of time.

Define and distinguish between final goods and intermediate goods.

Gross Domestic Product measures the

As measured,GDP omits which of the following? I.Illegal sales of goods and services Ii.Changes in the amount of leisure time Iii.Household production of goods and services

-The table gives data for a nation.What is the amount of the country's GDP?

Total income in a country in 2012 is $780 billion.Total expenditure in the country

Which of the following is true regarding the measurement of GDP?

How are final goods and services valued when measuring nominal GDP?

-Using the information in the table above,what does GDP equal?

Bob's Funky T-shirts began the year with 1,000 shirts in inventory,produced 10,000 shirts during the year and ended the year with 1,100 shirts in inventory.The 100 shirts added to his inventory will be classified as

Explain why the purchase and sale of used goods and of financial assets are not included in the calculation of GDP even though transactions in these items amount to billions of dollars daily.

Gross Domestic Product is defined to be the market value of all the final goods and services produced during a given time period

The largest expenditure category in the United States is

Which of the following goods and services are omitted from GDP?

What is the relationship shown by the circular flow among income,total expenditure,and GDP?

The expenditure approach to measuring GDP is based on summing

Comparing nominal GDP of 2012 to nominal GDP of twenty years ago

The U.S.economy is experiencing falling output,falling employment,falling incomes and rising unemployment.These conditions best describe a business cycle

-The table gives data on the production and prices in a small economy.Use 2012 as the base period.Using the chained-price method,what is the growth rate of real GDP from 2012 to 2013?

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 14: Gdp: a Measure of Total Production and Income

In order to measure gross domestic product,we can follow

GDP is equal to the ________ value of all the final goods and services produced within a country in a given period of time.

Define and distinguish between final goods and intermediate goods.

Gross Domestic Product measures the

As measured,GDP omits which of the following? I.Illegal sales of goods and services Ii.Changes in the amount of leisure time Iii.Household production of goods and services

-The table gives data for a nation.What is the amount of the country's GDP?

Total income in a country in 2012 is $780 billion.Total expenditure in the country

Which of the following is true regarding the measurement of GDP?

How are final goods and services valued when measuring nominal GDP?

-Using the information in the table above,what does GDP equal?

Bob's Funky T-shirts began the year with 1,000 shirts in inventory,produced 10,000 shirts during the year and ended the year with 1,100 shirts in inventory.The 100 shirts added to his inventory will be classified as

Explain why the purchase and sale of used goods and of financial assets are not included in the calculation of GDP even though transactions in these items amount to billions of dollars daily.

Gross Domestic Product is defined to be the market value of all the final goods and services produced during a given time period

The largest expenditure category in the United States is

Which of the following goods and services are omitted from GDP?

What is the relationship shown by the circular flow among income,total expenditure,and GDP?

The expenditure approach to measuring GDP is based on summing

Comparing nominal GDP of 2012 to nominal GDP of twenty years ago

The U.S.economy is experiencing falling output,falling employment,falling incomes and rising unemployment.These conditions best describe a business cycle

-The table gives data on the production and prices in a small economy.Use 2012 as the base period.Using the chained-price method,what is the growth rate of real GDP from 2012 to 2013?

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters