Question 1

If the GDP deflator is less than 100,then for that year nominal GDP ________ real GDP.

Accepted Answer

A) equals 
B) is greater than 
C) is less than 
D) may be greater than or less than 
A) equals 
B) is greater than 
C) is less than 
D) may be greater than or less than

Question 2

Which of the following is not true about the composition of GDP in 2010?

Accepted Answer

A) The majority of consumer spending is on durable goods. 
B) Purchases made by state and local governments are greater than purchases made by the federal government. 
C) Imports are greater than exports. 
D) Business fixed investment is the largest component of investment. 
A) The majority of consumer spending is on durable goods. 
B) Purchases made by state and local governments are greater than purchases made by the federal government. 
C) Imports are greater than exports. 
D) Business fixed investment is the largest component of investment.

Question 3

Real GDP is GDP in a given year

Accepted Answer

A) adjusted only for anticipated inflation. 
B) adjusted only for unanticipated inflation. 
C) valued in the prices of that year. 
D) valued in the prices of the base year. 
A) adjusted only for anticipated inflation. 
B) adjusted only for unanticipated inflation. 
C) valued in the prices of that year. 
D) valued in the prices of the base year.

Question 4

In 2010,which component of GDP had a negative value?

Accepted Answer

A) consumption 
B) investment 
C) government spending 
D) net exports 
A) consumption 
B) investment 
C) government spending 
D) net exports

Question 5

Investment,as defined by economists,would not include which of the following? Ford

Accepted Answer

A) buys a new robotic machine (from a plant in Ohio)to assemble cars. 
B) adds 1,000 new cars to inventories. 
C) builds another assembly plant in the United States. 
D) buys U.S.government bonds. 
A) buys a new robotic machine (from a plant in Ohio)to assemble cars. 
B) adds 1,000 new cars to inventories. 
C) builds another assembly plant in the United States. 
D) buys U.S.government bonds.

Question 6

To examine how the total production of an economy has changed over time,it would be better to examine

Accepted Answer

A) real GDP. 
B) nominal GDP. 
C) GDP at current prices. 
D) the GDP deflator. 
A) real GDP. 
B) nominal GDP. 
C) GDP at current prices. 
D) the GDP deflator.

Question 7

Table 12-16
  
-Refer to Table 12-16.The table above represents hypothetical data from the National Income Accounts for 2011.Use the data to calculate personal income and disposable income.

Accepted Answer

Personal income = National income - Reta

Question 8

Nominal GDP will increase

Accepted Answer

A) only if the price level rises. 
B) only if the price level falls. 
C) only if the quantity of final goods and services produced rises. 
D) if either the price level or the quantity of goods and services produced rises. 
A) only if the price level rises. 
B) only if the price level falls. 
C) only if the quantity of final goods and services produced rises. 
D) if either the price level or the quantity of goods and services produced rises.

Question 9

If nominal GDP exceeds real GDP for a specific year,then the GDP deflator must be

Accepted Answer

A) equal to 100. 
B) greater than 100. 
C) less than 100. 
D) less than 0. 
A) equal to 100. 
B) greater than 100. 
C) less than 100. 
D) less than 0.

Question 10

Table 12-12
  
-Refer to Table 12-12.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2010 equals

Accepted Answer

A) 94.1. 
B) 105.1. 
C) 106.2. 
D) 108.5. 
A) 94.1. 
B) 105.1. 
C) 106.2. 
D) 108.5.

Question 11

Table 12-11
  
-Refer to Table 12-11.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2011 equals

Accepted Answer

A) 92.2. 
B) 102.6. 
C) 108.5. 
D) 109.1. 
A) 92.2. 
B) 102.6. 
C) 108.5. 
D) 109.1.

Question 12

Which of the following is not an example of a transfer payment?

Accepted Answer

A) unemployment insurance payments 
B) health insurance payments to an army private 
C) social security payments to retirees 
D) social security payments to disabled persons 
A) unemployment insurance payments 
B) health insurance payments to an army private 
C) social security payments to retirees 
D) social security payments to disabled persons

Question 13

Increases in real GDP would overstate the increase in the well-being of a country over time if,over that time period,the

Accepted Answer

A) average hours worked per week increased. 
B) amount of pollution decreased. 
C) price level increased. 
D) crime rate decreased. 
A) average hours worked per week increased. 
B) amount of pollution decreased. 
C) price level increased. 
D) crime rate decreased.

Question 14

The nominal GDP of the U.S.in 2010 was approximately $14.6 trillion.This means that

Accepted Answer

A) the value of output in 2010 was around $14.6 trillion. 
B) total income in 2010 was around $14.6 trillion. 
C) total spending in 2010 was around $14.6 trillion. 
D) all of the above are true. 
A) the value of output in 2010 was around $14.6 trillion. 
B) total income in 2010 was around $14.6 trillion. 
C) total spending in 2010 was around $14.6 trillion. 
D) all of the above are true.

Question 15

In the first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as ________ when purchased by households and ________ when purchased by businesses.

Accepted Answer

A) nondurable goods;durable goods 
B) consumption;investment 
C) investment;consumption 
D) durable goods;nondurable goods 
A) nondurable goods;durable goods 
B) consumption;investment 
C) investment;consumption 
D) durable goods;nondurable goods

Question 16

To calculate GDP by the expenditure method,one must add

Accepted Answer

A) wages,rents,interest,and profits. 
B) consumption spending,investment spending,government spending and net exports. 
C) consumption spending,investment spending,government spending and exports. 
D) labor,natural resources,entrepreneurship,and capital. 
A) wages,rents,interest,and profits. 
B) consumption spending,investment spending,government spending and net exports. 
C) consumption spending,investment spending,government spending and exports. 
D) labor,natural resources,entrepreneurship,and capital.

Question 17

If income is unequally distributed in an economy,increases in GDP may not raise well-being in an economy.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is likely to increase measured GDP?

Accepted Answer

A) A greater number of women decide to stay at home and provide day care for their children under age 5. 
B) Marijuana becomes legal to grow and sell. 
C) Tax rates increase and more people attempt to underreport their income for tax purposes. 
D) More people decide to do their own lawn maintenance and give up using a professional service. 
A) A greater number of women decide to stay at home and provide day care for their children under age 5. 
B) Marijuana becomes legal to grow and sell. 
C) Tax rates increase and more people attempt to underreport their income for tax purposes. 
D) More people decide to do their own lawn maintenance and give up using a professional service.

Question 19

The sum of the value added of every firm involved in producing all final goods and services ________ gross domestic product.

Accepted Answer

A) equals 
B) is greater than 
C) is less than 
D) is sometimes greater than and other times less than 
A) equals 
B) is greater than 
C) is less than 
D) is sometimes greater than and other times less than

Question 20

Gross domestic product is calculated by summing up

Accepted Answer

A) the total quantity of goods and services in the economy. 
B) the total quantity of goods and services produced in the economy during a period of time. 
C) the total market value of goods and services in the economy. 
D) the total market value of final goods and services produced in the economy during a period of time. 
A) the total quantity of goods and services in the economy. 
B) the total quantity of goods and services produced in the economy during a period of time. 
C) the total market value of goods and services in the economy. 
D) the total market value of final goods and services produced in the economy during a period of time.

If the GDP deflator is less than 100,then for that year nominal GDP ________ real GDP.

Which of the following is not true about the composition of GDP in 2010?

Real GDP is GDP in a given year

In 2010,which component of GDP had a negative value?

Investment,as defined by economists,would not include which of the following? Ford

To examine how the total production of an economy has changed over time,it would be better to examine

Table 12-16 -Refer to Table 12-16.The table above represents hypothetical data from the National Income Accounts for 2011.Use the data to calculate personal income and disposable income.

Nominal GDP will increase

If nominal GDP exceeds real GDP for a specific year,then the GDP deflator must be

Table 12-12 -Refer to Table 12-12.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2010 equals

Table 12-11 -Refer to Table 12-11.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2011 equals

Which of the following is not an example of a transfer payment?

Increases in real GDP would overstate the increase in the well-being of a country over time if,over that time period,the

The nominal GDP of the U.S.in 2010 was approximately $14.6 trillion.This means that

In the first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as when purchased by households and when purchased by businesses.

To calculate GDP by the expenditure method,one must add

If income is unequally distributed in an economy,increases in GDP may not raise well-being in an economy.

Which of the following is likely to increase measured GDP?

The sum of the value added of every firm involved in producing all final goods and services ________ gross domestic product.

Gross domestic product is calculated by summing up

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology,production,and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage,international Trade,and Exchange Rates

Filters

Exam 12: GDP: Measuring Total Production and Income

If the GDP deflator is less than 100,then for that year nominal GDP ________ real GDP.

Which of the following is not true about the composition of GDP in 2010?

Real GDP is GDP in a given year

In 2010,which component of GDP had a negative value?

Investment,as defined by economists,would not include which of the following? Ford

To examine how the total production of an economy has changed over time,it would be better to examine

Table 12-16 -Refer to Table 12-16.The table above represents hypothetical data from the National Income Accounts for 2011.Use the data to calculate personal income and disposable income.

Nominal GDP will increase

If nominal GDP exceeds real GDP for a specific year,then the GDP deflator must be

Table 12-12 -Refer to Table 12-12.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2010 equals

Table 12-11 -Refer to Table 12-11.Consider the following data on nominal GDP and real GDP (values are in billions of dollars): The GDP deflator for 2011 equals

Which of the following is not an example of a transfer payment?

Increases in real GDP would overstate the increase in the well-being of a country over time if,over that time period,the

The nominal GDP of the U.S.in 2010 was approximately $14.6 trillion.This means that

In the first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as ________ when purchased by households and ________ when purchased by businesses.

To calculate GDP by the expenditure method,one must add

If income is unequally distributed in an economy,increases in GDP may not raise well-being in an economy.

Which of the following is likely to increase measured GDP?

The sum of the value added of every firm involved in producing all final goods and services ________ gross domestic product.

Gross domestic product is calculated by summing up

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology,production,and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage,international Trade,and Exchange Rates

Filters

In the first half of 2011,automobile sales in the United States were lower than they were in the first half of 2010.The decrease in auto sales impacts GDP because new automobiles are counted as when purchased by households and when purchased by businesses.