Question 1

An economy's income is the same as its expenditure because every transaction has a buyer and a seller.

Accepted Answer

A) True 
 B)False

Question 2

The GDP deflator for years subsequent to the base year measures the change in

Accepted Answer

A)   nominal GDP from the base year that cannot be attributable to a change in real GDP.
B)   real GDP from the base year that cannot be attributable to a change in nominal GDP.
C)   nominal GDP from the base year that cannot be attributable to a change in prices.
D)   real GDP from the base year that cannot be attributable to a change in prices.E) None of the above
F) A) and B)

Question 3

Recessions are associated with lower incomes,rising unemployment,and falling profits.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is not included in GDP?

Accepted Answer

A)   carrots grown in your garden and eaten by your family
B)   carrots purchased at a farmer's market and eaten by your family
C)   carrots purchased at a grocery store and eaten by your family
D)   None of the above are included in GDP.E) B) and D)
F) All of the above

Question 5

If nominal GDP is $8 trillion and real GDP is $10 trillion,then the GDP deflator is

Accepted Answer

A)   80,and this indicates that the price level has decreased by 20 percent since the base year.
B)   80,and this indicates that the price level has increased by 80 percent since the base year.
C)   125,and this indicates that the price level has increased by 25 percent since the base year.
D)   125,and this indicates that the price level has increased by 125 percent since the base year.E) A) and C)
F) All of the above

Question 6

For an economy as a whole,income must equal expenditure because

Accepted Answer

A)   the number of firms is equal to the number of households in an economy.
B)   individuals can only spend what they earn each period.
C)   every dollar of spending by some buyer is a dollar of income for some seller.
D)   every dollar of saving by some consumer is a dollar of spending by some other consumer.E) A) and B)
F) All of the above

Question 7

Gross domestic product includes all

Accepted Answer

A)   legal and illegal final goods,but it excludes all legal and illegal final services.
B)   legal and illegal final goods and all legal and illegal final services.
C)   legal final goods and services,but it excludes illegal final goods and services.
D)   legal and illegal final goods and legal final services,but it excludes illegal final services.E) A) and B)
F) A) and C)

Question 8

Table 15-1
The table below contains data for Bahkan for the year 2010.
 
-Refer to Table 15-1.The market value of all final goods and services produced within Bahkan in 2010 is

Accepted Answer

A)   $95.
B)   $100.
C)   $110.
D)   $120.E) C) and D)
F) B) and C)

Question 9

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 consumption in 2010?

Accepted Answer

A)   $1810
B)   $2013
C)   $2315
D)   $3131E) B) and D)
F) None of the above

Question 10

The information below for 2008 in millions was reported by the World Bank.On the basis of this information,which list below contains the correct ordering of GDP per person from highest to lowest? Country
GDP (Constant US$) 
GDP(Current US$) 
Population
Ghana
7,690
16,653
23) 35
Kenya
17,569
30,354
38) 76
Tanzania
15,394
20,490
41) 276

Accepted Answer

A)   Ghana,Kenya,Tanzania
B)   Ghana,Tanzania,Kenya
C)   Kenya,Tanzania,Ghana
D)   Kenya,Ghana,TanzaniaE) A) and C)
F) A) and B)

Question 11

Table 15-5
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 2009.
Prices and Quantities
 
-Refer to Table 15-5 In which year was this country's nominal GDP highest?

Accepted Answer

A)   2008
B)   2009
C)   2010
D)   2011E) B) and C)
F) B) and D)

Question 12

If consumption is $1800,GDP is $4300,government purchases are $1000,imports are $700,and investment is $1200,then exports are $300.

Accepted Answer

A) True 
 B)False

Question 13

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 investment in 2010?

Accepted Answer

A)   $675
B)   $1090
C)   $1491
D)   $1793E) B) and C)
F) All of the above

Question 14

The inflation rate is the

Accepted Answer

A)   absolute change in real GDP from one period to another.
B)   percentage change in real GDP from one period to another.
C)   absolute change in the price level from one period to another.
D)   percentage change in the price level from one period to another.E) C) and D)
F) B) and D)

Question 15

After the terrorist attacks on September 11,2001,governments within the United States raised expenditures to increase security at airports.These purchases of goods and services are

Accepted Answer

A)   not included in GDP since they do not represent production.
B)   not included in GDP since the government collects taxes to pay for them.
C)   included in GDP since government expenditures on goods and services are included in GDP.
D)   included in GDP only to the extent that the federal government,rather than state or local governments,paid for them.E) None of the above
F) A) and C)

Question 16

According to the circular-flow diagram GDP

Accepted Answer

A)   can be computed as either the revenue firms receive from the sales of goods and services or the payments they make to factors of production.
B)   can be computed as the revenue firms receive from the sales of goods and services but not as the payments they make to factors of production.
C)   can be computed as payments firms make to factors of production but not as revenues they receive from the sales of goods and services.
D)   cannot be computed as either the revenue firms receive or the payments they make to factors of production.E) B) and C)
F) A) and D)

Question 17

If an economy's GDP rises,then it must be the case that the economy's

Accepted Answer

A)   income rises and saving falls.
B)   income and saving both rise.
C)   income rises and expenditure falls.
D)   income and expenditure both rise.E) B) and C)
F) None of the above

Question 18

If in some year real GDP was $5 trillion and the GDP deflator was 200,what was nominal GDP?

Accepted Answer

A)   $2.5 trillion
B)   $10 trillion
C)   $40 trillion
D)   $100 trillionE) A) and B)
F) None of the above

Question 19

Table 15-1
The table below contains data for country A for the year 2010.
 
-Refer to Table 15-1.What were country A's imports in 2010?

Accepted Answer

A)   -$32
B)   $32
C)   $88
D)   $120E) All of the above
F) A) and B)

Question 20

Suppose that an economy produces 40,000 units of good A which sells at $4 a unit and 20,000 units of good B which sells at $5 per unit.Production of good A contributes

Accepted Answer

A)   2 times as much to GDP as the production of good B.
B)   8/5 times as much to GDP as the production of good B.
C)   5/4 times as much to GDP as the production of good B.
D)   4/5 times as much to GDP as production of good B.E) A) and B)
F) A) and C)

Exam 15: Measuring a Nations Income

Which of the following is not included in GDP?

Correct Answer
verified

If consumption is $1800,GDP is $4300,government purchases are $1000,imports are $700,and investment is $1200,then exports are $300.

Correct Answer
verified

Suppose that an economy produces 40,000 units of good A which sells at $4 a unit and 20,000 units of good B which sells at $5 per unit.Production of good A contributes

Correct Answer
verified

If an economy's GDP rises,then it must be the case that the economy's

Correct Answer
verified

An economy's income is the same as its expenditure because every transaction has a buyer and a seller.

Correct Answer
verified

Correct Answer
verified

The inflation rate is the

Correct Answer
verified

Table 15-5 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 2009. Prices and Quantities -Refer to Table 15-5 In which year was this country's nominal GDP highest?

Correct Answer
verified

The GDP deflator for years subsequent to the base year measures the change in

Correct Answer
verified

Recessions are associated with lower incomes,rising unemployment,and falling profits.

Correct Answer
verified

After the terrorist attacks on September 11,2001,governments within the United States raised expenditures to increase security at airports.These purchases of goods and services are

Correct Answer
verified

Table 15-1 The table below contains data for Bahkan for the year 2010. -Refer to Table 15-1.The market value of all final goods and services produced within Bahkan in 2010 is

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 investment in 2010?

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 consumption in 2010?

Correct Answer
verified

Gross domestic product includes all

Correct Answer
verified

According to the circular-flow diagram GDP

Correct Answer
verified

If in some year real GDP was $5 trillion and the GDP deflator was 200,what was nominal GDP?

Correct Answer
verified

Table 15-1 The table below contains data for country A for the year 2010. -Refer to Table 15-1.What were country A's imports in 2010?

Correct Answer
verified

If nominal GDP is $8 trillion and real GDP is $10 trillion,then the GDP deflator is

Correct Answer
verified

For an economy as a whole,income must equal expenditure because

Correct Answer
verified

Exam 15: Measuring a Nations Income

Which of the following is not included in GDP?

Correct AnswerverifiedShow Answer

If consumption is $1800,GDP is $4300,government purchases are $1000,imports are $700,and investment is $1200,then exports are $300.

Correct AnswerverifiedShow Answer

Suppose that an economy produces 40,000 units of good A which sells at $4 a unit and 20,000 units of good B which sells at $5 per unit.Production of good A contributes

Correct AnswerverifiedShow Answer

If an economy's GDP rises,then it must be the case that the economy's

Correct AnswerverifiedShow Answer

An economy's income is the same as its expenditure because every transaction has a buyer and a seller.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The inflation rate is the

Correct AnswerverifiedShow Answer

Table 15-5 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 2009. Prices and Quantities -Refer to Table 15-5 In which year was this country's nominal GDP highest?

Correct AnswerverifiedShow Answer

The GDP deflator for years subsequent to the base year measures the change in

Correct AnswerverifiedShow Answer

Recessions are associated with lower incomes,rising unemployment,and falling profits.

Correct AnswerverifiedShow Answer

After the terrorist attacks on September 11,2001,governments within the United States raised expenditures to increase security at airports.These purchases of goods and services are

Correct AnswerverifiedShow Answer

Table 15-1 The table below contains data for Bahkan for the year 2010. -Refer to Table 15-1.The market value of all final goods and services produced within Bahkan in 2010 is

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 investment in 2010?

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 consumption in 2010?

Correct AnswerverifiedShow Answer

Gross domestic product includes all

Correct AnswerverifiedShow Answer

According to the circular-flow diagram GDP

Correct AnswerverifiedShow Answer

If in some year real GDP was $5 trillion and the GDP deflator was 200,what was nominal GDP?

Correct AnswerverifiedShow Answer

Table 15-1 The table below contains data for country A for the year 2010. -Refer to Table 15-1.What were country A's imports in 2010?

Correct AnswerverifiedShow Answer

If nominal GDP is $8 trillion and real GDP is $10 trillion,then the GDP deflator is

Correct AnswerverifiedShow Answer

For an economy as a whole,income must equal expenditure because

Correct AnswerverifiedShow Answer

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