Question 1

U.S.GDP includes estimates of the value of items that are produced and consumed at home,such as housework and car maintenance.

Accepted Answer

A) True 
 B)False

Question 2

A country reported nominal GDP of $200 billion in 2010 and $180 billion in 2009.It also reported a GDP deflator of 125 in 2010 and 105 in 2009.Between 2009 and 2010,

Accepted Answer

A)   real output and the price level both rose.
B)   real output rose and the price level fell.
C)   real output fell and the price level rose.
D)   real output and the price level both fell.E) B) and C)
F) B) and D)

Question 3

In the national income accounts,depreciation is called

Accepted Answer

A)   "consumption of fixed capital."
B)   "negative investment."
C)   "diminished value."
D)   "loss due to wear."E) All of the above
F) A) and C)

Question 4

Which of the following questions is more likely to be studied by a microeconomist than a macroeconomist?

Accepted Answer

A)   Why do prices in general rise by more in some countries than in others?
B)   Why do wages differ across industries?
C)   Why do national production and income increase in some periods and not in others?
D)   How rapidly is GDP currently increasing?E) A) and B)
F) B) and C)

Question 5

Which of the following items is included in U.S.GDP?

Accepted Answer

A)   goods produced by foreign citizens working in the United States
B)   the difference in the price of the sale of an existing home and its original purchase price
C)   known illegal activities
D)   None of the above is included in U.S.GDP.E) B) and D)
F) A) and D)

Question 6

Quality Motors is a Japanese-owned company that produces automobiles; all of its automobiles are produced in American plants.In 2010 Quality Motors produced $30 million worth of automobiles,with $17 million in sales to Americans,$9 million in sales to Canadians,and $4 million worth of automobiles added to Quality Motors' inventory.The transactions just described contribute how much to U.S.GDP for 2010?

Accepted Answer

A)   $17 million
B)   $21 million
C)   $26 million
D)   $30 millionE) C) and D)
F) B) and C)

Question 7

An American retailer purchased 100 pairs of shoes from a company in Denmark in the second quarter of 2010 but does not sell them to a consumer until the third quarter of 2010.In which quarter(s) is (are) the value of the shoes included in U.S.GDP?

Accepted Answer

A)   the second and third quarters
B)   the second quarter but not the third quarter
C)   the third but not the second quarter
D)   neither the second nor the third quarterE) All of the above
F) B) and D)

Question 8

Table 15-2
The table below contains data for the country of Crete for the year 2010.
 
-Refer to Table 15-2.What was Crete's GDP in 2010?

Accepted Answer

A)   $4623
B)   $5731
C)   $6037
D)   $6839E) B) and D)
F) None of the above

Question 9

The overall effect of accounting for purchases of foreign goods in GDP reduces GDP.

Accepted Answer

A) True 
 B)False

Question 10

Changes in real GDP reflect only changes in the amounts being produced.

Accepted Answer

A) True 
 B)False

Question 11

Consumer goods that are produced,go into inventory,and are not sold during the current period are

Accepted Answer

A)   counted as intermediate goods and so are not included in current period GDP.
B)   counted in current period GDP only if the firm that produced them sells them to another firm.
C)   included in current period GDP as inventory investment.
D)   included in current period GDP as consumption.E) None of the above
F) All of the above

Question 12

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.E) A) and C)
F) A) and B)

Question 13

The U.S.government pays an economist at the U.S.Department of Commerce $50,000 in salary in 2006.The economist then retires.In 2007,the government pays him $30,000 in retirement benefits.Which of the following is correct?

Accepted Answer

A)   The 2006 payment is included in 2006 GDP as government purchases,and the 2007 payment is included in 2007 GDP as government purchases.
B)   The 2006 payment is included in 2006 GDP as government purchases,but the 2007 payment is not included in 2007 GDP.
C)   The 2006 payment is included in 2006 GDP as government purchases,and the 2007 payment is included in 2007 GDP as government transfer payments.
D)   The 2006 payment is included in 2006 GDP as government purchases,and the 2007 payment is allocated to previous years' GDP according to the amount of work performed by the economist each year.E) None of the above
F) B) and C)

Question 14

Table 15-4
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 2008.
Prices and Quantities
 
-Refer to Table 15-4.In 2008,this country's

Accepted Answer

A)   nominal GDP was greater than real GDP,and the GDP deflator was greater than 100.
B)   nominal GDP was equal to real GDP,and the GDP deflator was equal to 1.
C)   nominal GDP was less than real GDP,and the GDP deflator was less than 100.
D)   nominal GDP was equal to real GDP,and the GDP deflator was equal to 100.E) B) and D)
F) A) and B)

Question 15

During a presidential campaign,the incumbent argues that he should be reelected because nominal GDP grew by 12 percent during his 4-year term in office.You know that population grew by 4 percent over the period and that the GDP deflator increased by 6 percent during the past 4 years.You should conclude that real GDP per person

Accepted Answer

A)   grew by more than 12 percent.
B)   grew,but by less than 12 percent.
C)   was unchanged.
D)   decreased.E) B) and D)
F) All of the above

Question 16

Last year country A had a nominal GDP of $600 billion,a GDP deflator of 150 and a population of 40 million.Country B had a nominal GDP of $720 billion,a GDP deflator of 120 and a population of 50 million.From these numbers which country is likely to have had the higher standard of living?

Accepted Answer

A)   Country A because it had the higher nominal GDP per person.
B)   Country B because it had the higher nominal GDP per person.
C)   Country A because it had the higher real GDP per person.
D)   Country B because it had the higher real GDP per person.E) None of the above
F) A) and D)

Question 17

A U.S.citizen buys a tea kettle manufactured in China by a company that is owned and operated by U.S citizens.In which of the following components of U.S.GDP is this transaction accounted for?

Accepted Answer

A)   consumption and imports
B)   consumption but not imports
C)   imports but not consumption
D)   neither consumption nor importsE) A) and B)
F) A) and C)

Question 18

Tim mows the yard for his neighbors.He spends $1 on gas and charges them $20 for each lawn he mows.What's the total contribution to GDP each time Tim mows a yard?

Accepted Answer

A)   $1
B)   $19
C)   $20
D)   $21E) A) and C)
F) A) and D)

Question 19

Over the last few decades,Americans have chosen to cook less at home and eat more at restaurants.This change in behavior,by itself,has

Accepted Answer

A)   reduced measured GDP.
B)   not affected measured GDP.
C)   increased measured GDP by the value of the restaurant meals.
D)   increased measured GDP by the value added by the restaurant's preparation and serving of the meals.E) C) and D)
F) All of the above

Question 20

If a U.S.citizen buys a television made in Korea by a Korean firm,then

Accepted Answer

A)   U.S.net exports decrease and U.S.GDP decreases.
B)   U.S.net exports are unaffected and U.S.GDP decreases.
C)   U.S.net exports are unaffected and U.S.GDP is unaffected.
D)   U.S.net exports decrease and U.S.GDP is unaffected.E) A) and B)
F) B) and D)

Exam 15: Measuring a Nations Income

Over the last few decades,Americans have chosen to cook less at home and eat more at restaurants.This change in behavior,by itself,has

Correct Answer
verified

Consumer goods that are produced,go into inventory,and are not sold during the current period are

Correct Answer
verified

A U.S.citizen buys a tea kettle manufactured in China by a company that is owned and operated by U.S citizens.In which of the following components of U.S.GDP is this transaction accounted for?

Correct Answer
verified

Table 15-4 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 2008. Prices and Quantities -Refer to Table 15-4.In 2008,this country's

Correct Answer
verified

Last year country A had a nominal GDP of $600 billion,a GDP deflator of 150 and a population of 40 million.Country B had a nominal GDP of $720 billion,a GDP deflator of 120 and a population of 50 million.From these numbers which country is likely to have had the higher standard of living?

Correct Answer
verified

Correct Answer
verified

In the national income accounts,depreciation is called

Correct Answer
verified

If a U.S.citizen buys a television made in Korea by a Korean firm,then

Correct Answer
verified

Changes in real GDP reflect only changes in the amounts being produced.

Correct Answer
verified

U.S.GDP includes estimates of the value of items that are produced and consumed at home,such as housework and car maintenance.

Correct Answer
verified

The overall effect of accounting for purchases of foreign goods in GDP reduces GDP.

Correct Answer
verified

An American retailer purchased 100 pairs of shoes from a company in Denmark in the second quarter of 2010 but does not sell them to a consumer until the third quarter of 2010.In which quarter(s) is (are) the value of the shoes included in U.S.GDP?

Correct Answer
verified

Tim mows the yard for his neighbors.He spends $1 on gas and charges them $20 for each lawn he mows.What's the total contribution to GDP each time Tim mows a yard?

Correct Answer
verified

The U.S.government pays an economist at the U.S.Department of Commerce $50,000 in salary in 2006.The economist then retires.In 2007,the government pays him $30,000 in retirement benefits.Which of the following is correct?

Correct Answer
verified

Changes in nominal GDP reflect

Correct Answer
verified

Which of the following items is included in U.S.GDP?

Correct Answer
verified

Which of the following questions is more likely to be studied by a microeconomist than a macroeconomist?

Correct Answer
verified

Table 15-2 The table below contains data for the country of Crete for the year 2010. -Refer to Table 15-2.What was Crete's GDP in 2010?

Correct Answer
verified

A country reported nominal GDP of $200 billion in 2010 and $180 billion in 2009.It also reported a GDP deflator of 125 in 2010 and 105 in 2009.Between 2009 and 2010,

Correct Answer
verified

Correct Answer
verified

Exam 15: Measuring a Nations Income

Over the last few decades,Americans have chosen to cook less at home and eat more at restaurants.This change in behavior,by itself,has

Correct AnswerverifiedShow Answer

Consumer goods that are produced,go into inventory,and are not sold during the current period are

Correct AnswerverifiedShow Answer

A U.S.citizen buys a tea kettle manufactured in China by a company that is owned and operated by U.S citizens.In which of the following components of U.S.GDP is this transaction accounted for?

Correct AnswerverifiedShow Answer

Table 15-4 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 2008. Prices and Quantities -Refer to Table 15-4.In 2008,this country's

Correct AnswerverifiedShow Answer

Last year country A had a nominal GDP of $600 billion,a GDP deflator of 150 and a population of 40 million.Country B had a nominal GDP of $720 billion,a GDP deflator of 120 and a population of 50 million.From these numbers which country is likely to have had the higher standard of living?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In the national income accounts,depreciation is called

Correct AnswerverifiedShow Answer

If a U.S.citizen buys a television made in Korea by a Korean firm,then

Correct AnswerverifiedShow Answer

Changes in real GDP reflect only changes in the amounts being produced.

Correct AnswerverifiedShow Answer

U.S.GDP includes estimates of the value of items that are produced and consumed at home,such as housework and car maintenance.

Correct AnswerverifiedShow Answer

The overall effect of accounting for purchases of foreign goods in GDP reduces GDP.

Correct AnswerverifiedShow Answer

An American retailer purchased 100 pairs of shoes from a company in Denmark in the second quarter of 2010 but does not sell them to a consumer until the third quarter of 2010.In which quarter(s) is (are) the value of the shoes included in U.S.GDP?

Correct AnswerverifiedShow Answer

Tim mows the yard for his neighbors.He spends $1 on gas and charges them $20 for each lawn he mows.What's the total contribution to GDP each time Tim mows a yard?

Correct AnswerverifiedShow Answer

The U.S.government pays an economist at the U.S.Department of Commerce $50,000 in salary in 2006.The economist then retires.In 2007,the government pays him $30,000 in retirement benefits.Which of the following is correct?

Correct AnswerverifiedShow Answer

Changes in nominal GDP reflect

Correct AnswerverifiedShow Answer

Which of the following items is included in U.S.GDP?

Correct AnswerverifiedShow Answer

Which of the following questions is more likely to be studied by a microeconomist than a macroeconomist?

Correct AnswerverifiedShow Answer

Table 15-2 The table below contains data for the country of Crete for the year 2010. -Refer to Table 15-2.What was Crete's GDP in 2010?

Correct AnswerverifiedShow Answer

A country reported nominal GDP of $200 billion in 2010 and $180 billion in 2009.It also reported a GDP deflator of 125 in 2010 and 105 in 2009.Between 2009 and 2010,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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