question
Gross Domestic Product (GDP) is the total market value of:
answer
final goods and services produced annually within a country's borders
question
Which of the following would definitely not be counted in the measurement of GDP?
a) value of services of a roofer who fixes the roof of our house
b) value of the services of a person who cooks his or own food
c) value of the services of a person who cleans your house
d) value of the services of a friend of yours who plants a tree on your property
a) value of services of a roofer who fixes the roof of our house
b) value of the services of a person who cooks his or own food
c) value of the services of a person who cleans your house
d) value of the services of a friend of yours who plants a tree on your property
answer
b
question
Investment is equal to
answer
-Fixed investment plus inventory investment
-the purchase of new capital goods plus the purchases of new residential housing plus inventory investment
-the purchase of new capital goods plus the purchases of new residential housing plus inventory investment
question
National income equals the compensation of employees plus
answer
proprietors' income, corporate profits, rental income, and net interest
question
The capital consumption allowances refers to:
answer
capital goods being used up in production through natural wear, obsolescence, and accidental destruction
question
Net domestic product is the total market value of:
answer
all final goods and services produced annually within a country's borders minus the capital consumption allowance
question
Economic growth has occurred if:
answer
Real GDP in one year exceeds the Real GDP in the previous year
question
Which of the following statements is false:
a) Durable goods are goods that are expected to last more than three years
b) Investment is the sum of fixed investment and inventory investment
c) Net exports equals exports minus imports
d) Investment is the largest expenditure component of GDP
e) Personal income is the amount of income that individuals actually recieve
a) Durable goods are goods that are expected to last more than three years
b) Investment is the sum of fixed investment and inventory investment
c) Net exports equals exports minus imports
d) Investment is the largest expenditure component of GDP
e) Personal income is the amount of income that individuals actually recieve
answer
d
question
Given the following data, what is the value of the durable goods for this economy?
Consumption = 500 billion
Non-durable goods = 100 billion
Services = 200 billion
New residential construction = 50 billion
Consumption = 500 billion
Non-durable goods = 100 billion
Services = 200 billion
New residential construction = 50 billion
answer
200 billion
Consumption is the sum of spending durable goods, nondurable goods, and services
Consumption is the sum of spending durable goods, nondurable goods, and services
question
Which of the following is omitted form GDP?
a) the trading of stocks and bonds
b) the purchase of a new car by the gov't
c) the market value of food produced and consumed by a family that works on the farm
d) purchases of new residential housing
a) the trading of stocks and bonds
b) the purchase of a new car by the gov't
c) the market value of food produced and consumed by a family that works on the farm
d) purchases of new residential housing
answer
the trading of stocks and bonds
question
______________ is the largest spending component of GDP usually accounting for around ___________ percent of the U.S. GDP
answer
Consumption; 70
question
Real GDP is GDP that has been stated
answer
in base year prices
question
The standard definition of "recession" defines a recession as occurring when:
answer
Real GDP has declined for two consecutive quarters
question
Look at the following data (stated in billions of dollars):
consumption = 600
exports = 90
imports = 95
inventory investment = 110
fixed investment = 150
gov't purchases = 300
GDP is equal to __________ billion
consumption = 600
exports = 90
imports = 95
inventory investment = 110
fixed investment = 150
gov't purchases = 300
GDP is equal to __________ billion
answer
1,155
question
If a country has a GDP of 80 billion and its population is 2 million, then its per-capita GDP is:
answer
40,000
Per-capita GDP is computed by dividing country's GDP by its population
Per-capita GDP is computed by dividing country's GDP by its population
question
An economy with 480 million in exports and (-100) million in net exports has imports equal to
answer
580 million
question
Real GDP rises when ________ rises, while GDP rises when ________ rises, and so ___________ is the better gauge of an economy's health
answer
Output; output or the price level; Real GDP
-GDP is measured in current year prices and can rise because the price level has risen or output has risen
-Real GDP is measured in base year prices and can only rise when output rises.
-Real GDP is thus a better measure for tracking changes in a business cylcle
-GDP is measured in current year prices and can rise because the price level has risen or output has risen
-Real GDP is measured in base year prices and can only rise when output rises.
-Real GDP is thus a better measure for tracking changes in a business cylcle
question
Based on the data from a hypothetical country presented in the following table (shown in billions), what was the country's economic growth rate in 2012?
2011: Nominal GDP = 16,028.7
Real GDP = 14,616.4
2012: Nominal GDP: 16,221.5
Real GDP = 14,961.7
2011: Nominal GDP = 16,028.7
Real GDP = 14,616.4
2012: Nominal GDP: 16,221.5
Real GDP = 14,961.7
answer
2.36%
-GDP is measured in current year prices and Real GDP is measured in base year prices.
-The economic growth rate is the percentage change in Real GDP from one period to another
-GDP is measured in current year prices and Real GDP is measured in base year prices.
-The economic growth rate is the percentage change in Real GDP from one period to another
question
A simple circular flow diagram shows that _______ equals _______
answer
GDP; total income
-The top half of a simple circular diagram shows the relationship that exists in the product markets between the purchasers and the producers. Households, businesses, the gov't and the foreign sector purchase goods and services produced by the business firms the sum of which is GDP
-The bottom half of a simple circular flow diagram shows the relationship exists in the resource markets between the resource owners and the business firms the sum of these payments is total income
-The amount of money flowing through the top half of the diagram is equal to the amount flowing through the bottom half, and thus GDP equals total income
-The top half of a simple circular diagram shows the relationship that exists in the product markets between the purchasers and the producers. Households, businesses, the gov't and the foreign sector purchase goods and services produced by the business firms the sum of which is GDP
-The bottom half of a simple circular flow diagram shows the relationship exists in the resource markets between the resource owners and the business firms the sum of these payments is total income
-The amount of money flowing through the top half of the diagram is equal to the amount flowing through the bottom half, and thus GDP equals total income
question
According to economists, leisure is ______ in GDP calculations because it is ________
answer
not counted; too difficult to measure
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