Question 1

Greenhouse gas emissions are included in the GDP accounts.

Accepted Answer

A) True 
 B)False

Question 2

If in the past you have always painted your own house but now you hire a painting contractor to do the work,what is the effect on GDP?

Accepted Answer

A)   GDP is unaffected by this change.
B)   GDP falls as a result of this change.
C)   GDP at first rises but then falls.
D)   GDP rises as a result of this change.E) C) and D)
F) A) and C)

Question 3

The four types of spending in GDP are personal consumer spending,___________ private domestic investment,government spending,and _______.

Accepted Answer

A)   gross;net exports
B)   gross;net imports
C)   net;net exports
D)   net;net importsE) A) and B)
F) None of the above

Question 4

Which of the following is TRUE in the case of the simple circular flow model with no saving?

Accepted Answer

A)   Total spending is greater than total income.
B)   Total spending equals total income only at full employment.
C)   Total spending equals total income.
D)   Total spending is less than total income.E) A) and B)
F) None of the above

Question 5

What does M represent in the following formula? GDP = C + I + G + (X - M)

Accepted Answer

A)   exports
B)   government spending
C)   personal consumer spending
D)   importsE) All of the above
F) A) and D)

Question 6

Which of the following will NOT be included in the GDP?

Accepted Answer

A)   the value of a meal eaten at Wendy's in New York City but consumed by a tourist from Norway
B)   the value of Kansas corn
C)   college tuition
D)   a cruise on a ship registered in NorwayE) A) and B)
F) A) and C)

Question 7

The Integrated Environmental and Economic Satellite Accounts are intended to take into account the environmental benefits or harmful effects of economic activity.

Accepted Answer

A) True 
 B)False

Question 8

_____ are almost 70% of GDP,while _____ are about 15% of GDP.

Accepted Answer

A)   Personal consumption expenditures;government expenditures
B)   Personal consumption expenditures;gross private domestic investments
C)   Government expenditures;gross private domestic investments
D)   Government expenditures;net exportsE) C) and D)
F) None of the above

Question 9

Which of the following is TRUE within the circular flow of economic activity?

Accepted Answer

A)   Households are buyers of products and sellers of production factors.
B)   Business firms are buyers and sellers of production factors.
C)   Households are sellers of products and buyers of production factors.
D)   Business firms are buyers of products and sellers of production factors.E) All of the above
F) A) and D)

Question 10

A simple circular flow diagram shows that the factors of production are:

Accepted Answer

A)   owned by the government.
B)   purchased by households.
C)   purchased by businesses.
D)   traded in the market for goods and services.E) B) and C)
F) None of the above

Question 11

The study of macroeconomics as a specific discipline is due primarily to:

Accepted Answer

A)   Adam Smith.
B)   John Maynard Keynes.
C)   Milton Friedman.
D)   Joseph Schumpeter.E) A) and B)
F) A) and C)

Question 12

Which of the following items is NOT a category of personal consumption expenditures?

Accepted Answer

A)   durable goods
B)   nondurable goods
C)   residential housing
D)   servicesE) A) and D)
F) C) and D)

Question 13

In the circular flow diagram,the clockwise direction shows the flow of _____,where households supply _____ and businesses supply _____.

Accepted Answer

A)   money;purchases of goods and services;income to households
B)   money;labor;goods and services
C)   goods and services;labor;goods and services
D)   goods and services;purchases of goods and services;income to householdsE) A) and D)
F) None of the above

Question 14

What are the national income and product accounts? Give examples of some of the measures in use today.

Accepted Answer

The national income and product accounts...

Question 15

What component of U.S.GDP is usually negative in boom years?

Accepted Answer

A)   consumption
B)   investment
C)   government spending
D)   net exportsE) A) and C)
F) C) and D)

Question 16

What are the four major expenditure components of GDP? Provide examples to describe each component.

Accepted Answer

Gross domestic product can be measured u...

Question 17

Which of the following is an example of an economic investment?

Accepted Answer

A)   building a new sales force training facility
B)   putting funds in a certificate of deposit
C)   purchasing a share of Google stock
D)   trading a bond certificateE) All of the above
F) A) and B)

Question 18

The simple circular flow diagram shows that economic aggregates can be calculated either by the _____________ flows in the product market or by the ______________ flowing to households in the resource market.

Accepted Answer

A)   spending;income
B)   income;spending
C)   output;spending
D)   spending;outputE) A) and B)
F) B) and C)

Question 19

The primary purpose of the circular flow model is to show how government policies affect businesses and households.

Accepted Answer

A) True 
 B)False

Question 20

The main purpose of the national income and product accounts is to provide information on the economy's overall performance.

Accepted Answer

A) True 
 B)False

Exam 5: Introduction to Macroeconomics

Greenhouse gas emissions are included in the GDP accounts.

Correct AnswerverifiedShow Answer

Which of the following is TRUE within the circular flow of economic activity?

Correct AnswerverifiedShow Answer

Which of the following is an example of an economic investment?

Correct AnswerverifiedShow Answer

Which of the following will NOT be included in the GDP?

Correct AnswerverifiedShow Answer

What component of U.S.GDP is usually negative in boom years?

Correct AnswerverifiedShow Answer

The Integrated Environmental and Economic Satellite Accounts are intended to take into account the environmental benefits or harmful effects of economic activity.

Correct AnswerverifiedShow Answer

The primary purpose of the circular flow model is to show how government policies affect businesses and households.

Correct AnswerverifiedShow Answer

A simple circular flow diagram shows that the factors of production are:

Correct AnswerverifiedShow Answer

The four types of spending in GDP are personal consumer spending,___________ private domestic investment,government spending,and _______.

Correct AnswerverifiedShow Answer

Which of the following items is NOT a category of personal consumption expenditures?

Correct AnswerverifiedShow Answer

What are the national income and product accounts? Give examples of some of the measures in use today.

Correct AnswerverifiedThe national income and product accounts...View AnswerShow Answer

In the circular flow diagram,the clockwise direction shows the flow of _____,where households supply _____ and businesses supply _____.

Correct AnswerverifiedShow Answer

Which of the following is TRUE in the case of the simple circular flow model with no saving?

Correct AnswerverifiedShow Answer

The study of macroeconomics as a specific discipline is due primarily to:

Correct AnswerverifiedShow Answer

The simple circular flow diagram shows that economic aggregates can be calculated either by the _____________ flows in the product market or by the ______________ flowing to households in the resource market.

Correct AnswerverifiedShow Answer

If in the past you have always painted your own house but now you hire a painting contractor to do the work,what is the effect on GDP?

Correct AnswerverifiedShow Answer

What are the four major expenditure components of GDP? Provide examples to describe each component.

Correct AnswerverifiedGross domestic product can be measured u...View AnswerShow Answer

What does M represent in the following formula? GDP = C + I + G + (X - M)

Correct AnswerverifiedShow Answer

The main purpose of the national income and product accounts is to provide information on the economy's overall performance.

Correct AnswerverifiedShow Answer

_____ are almost 70% of GDP,while _____ are about 15% of GDP.

Correct AnswerverifiedShow Answer

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The four types of spending in GDP are personal consumer spending,_____ private domestic investment,government spending,and _.

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The national income and product accounts...
View Answer

In the circular flow diagram,the clockwise direction shows the flow of ___,where households supply _ and businesses supply ___.

Correct Answer
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The simple circular flow diagram shows that economic aggregates can be calculated either by the _ flows in the product market or by the __ flowing to households in the resource market.

Correct Answer
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Gross domestic product can be measured u...
View Answer

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_ are almost 70% of GDP,while _ are about 15% of GDP.

Correct Answer
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