Question 1

The values of real GDP and real GNP are almost the same in countries where a significant fraction of domestic production takes place in foreign-owned firms.

Accepted Answer

A) True 
 B)False

Question 2

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

Question 3

The factors of production include

Accepted Answer

A)  wages.
B)  capital.
C)  investment.
D)  transfers.E) B) and C)
F) A) and B)

Question 4

An example of business fixed investment spending is

Accepted Answer

A)  a purchase of a home by a household.
B)  a purchase of a computer by an accounting firm.
C)  a purchase of a bond by General Electric Corporation.
D)  $200 million of unsold cars at a car dealership.E) A) and B)
F) C) and D)

Question 5

Between 2015 and 2016,if an economy's exports rise by $8 billion and its imports fall by $8 billion,by how much will GDP change between the two years,all else equal?

Accepted Answer

A)  Net exports will increase GDP by $8 billion.
B)  The increase in exports is offset by the decrease in imports,so there is no change in net exports and no effect on GDP.
C)  Net exports will increase GDP by $16 billion.
D)  Net exports will decrease GDP by $8 billion.E) A) and D)
F) None of the above C

Question 6

If Gladys sells her 1998 Jeep Cherokee for $3,500 in 2016,the sale of her car contributes $3,500 to 2016 GDP.

Accepted Answer

A) True 
 B)False

Question 7

Nominal GDP measures the value of all final goods and services at base-year prices.

Accepted Answer

A) True 
 B)False

Question 8

China's current rate of GDP growth is quite rapid.Its current growth rate is probably three times that of the United States.However,the levels of pollution are much higher in China.Would you consider China to be better off than the United States given this information? Why or why not?

Accepted Answer

China is not better off because of higher rates of growth of GDP.GDP is not a perfect measure of well-being.GDP is not adjusted for pollution or other negative effects of production.Certainly the rapid growth of GDP raises the standards of living of many in China.However,this comes at a cost of dirty air and water.According to the World Health Organization,seven of the ten most polluted cities in the world are in China.This pollution can result in negative health effects.The improvement in standards of living affect well-being in a positive manner,but the increased pollution has a negative effect on well-being.In addition,GDP per capita may be a better measure of standard of living rather than growth in GDP.

Question 9

Which of the following is included in gross domestic product for an economy in a given year?

Accepted Answer

A)  the value of intermediate goods produced in that year
B)  the value of used goods sold in that year
C)  the value of final goods produced in that year
D)  All of the above would be included in gross domestic product for an economy in a given year.E) A) and B)
F) C) and D)

Question 10

The underground economy - the informal sector - can be a significant drag on the economies of developing countries.Why are firms in the informal sector often less efficient than firms in the formal sector?

Accepted Answer

Entrepreneurs of the firms in the inform...

Question 11

Transfer payments are subtracted from national income to get to personal income.

Accepted Answer

A) True 
 B)False  False

Question 12

The values of real GDP and real GNP are almost the same for the United States.

Accepted Answer

A) True 
 B)False

Question 13

Table 8-16
 
-Refer to Table 8-16.Given the information above,what can we say has happened in the economy from 2015 to 2016?

Accepted Answer

A)  The price level has fallen.
B)  The price level has risen.
C)  The price level has remained constant.
D)  Not enough information is available to determine what has happened to prices.E) A) and B)
F) A) and C)

Question 14

Table 8-3
 
-Refer to Table 8-3.Consider the data above (in billions of dollars) for an economy: Gross domestic product (in billions of dollars) for this economy equals

Accepted Answer

A)  $2,200.
B)  $1,600.
C)  $1,400.
D)  $1,200.E) A) and B)
F) C) and D)

Question 15

Table 8-26
 
-Refer to Table 8-26.Given the information above,calculate the GDP deflator for both 2015 and 2016.What does the value of the deflator in the year 2015 tell you about that year with respect to the base year? What happened to prices in 2016 as compared to 2015?

Accepted Answer

To calculate the GDP deflator for 2012 a...

Question 16

Gross national product is defined as

Accepted Answer

A)  the value of final goods and services produced within the United States.
B)  the value of final goods and services produced outside of the United States.
C)  the value of final goods and services produced by residents of the United States even if the production takes place outside of the United States.
D)  the value of final goods and services produced within the United States,by United States residents.E) B) and C)
F) None of the above

Question 17

The purchase by a foreign government of an airplane produced in the United States is included in U.S.

Accepted Answer

A)  consumption expenditures.
B)  investment expenditures.
C)  government purchases.
D)  net exports.E) A) and B)
F) B) and D)

Question 18

Suppose Bob works for Mary as a proofreader.Mary and Bob fall deeply in love,marry,and have eight children.Bob stops working for Mary in order to care for the children.What will be the effect on GDP?

Accepted Answer

A)  GDP will decrease.
B)  GDP will increase.
C)  GDP will not change.
D)  GDP may increase or may decrease depending on inflation.E) B) and C)
F) C) and D)

Question 19

In 2016,Kendall Ford,an automobile dealership,spent $20,000 on a new car lift for its repair shop,$2,000 on a new copy machine for its sales division,and $600,000 on Ford Motor company stock.Unsold cars and trucks were valued at $400,000 on January 1,2016 and unsold cars and trucks were valued at $900,000 on December 31,2016.What is Kendall Ford's total investment spending in 2016?

Accepted Answer

A)  $22,000
B)  $322,000
C)  $522,000
D)  $1,022,000E) None of the above
F) A) and B)

Question 20

Table 8-15
 
-Refer to Table 8-15.Consider the following data on nominal GDP and real GDP (values are in billions of dollars) : The GDP deflator for 2015 equals

Accepted Answer

A)  94.1.
B)  105.1.
C)  106.2.
D)  108.5.E) C) and D)
F) None of the above

Exam 8: Gdp: Measuring Total Production and Income

The values of real GDP and real GNP are almost the same in countries where a significant fraction of domestic production takes place in foreign-owned firms.

Correct Answer
verified

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

Correct Answer
verified

The factors of production include

Correct Answer
verified

An example of business fixed investment spending is

Correct Answer
verified

Between 2015 and 2016,if an economy's exports rise by $8 billion and its imports fall by $8 billion,by how much will GDP change between the two years,all else equal?

Correct Answer
verified
C

If Gladys sells her 1998 Jeep Cherokee for $3,500 in 2016,the sale of her car contributes $3,500 to 2016 GDP.

Correct Answer
verified

Nominal GDP measures the value of all final goods and services at base-year prices.

Correct Answer
verified

China's current rate of GDP growth is quite rapid.Its current growth rate is probably three times that of the United States.However,the levels of pollution are much higher in China.Would you consider China to be better off than the United States given this information? Why or why not?

Which of the following is included in gross domestic product for an economy in a given year?

Correct Answer
verified

The underground economy - the informal sector - can be a significant drag on the economies of developing countries.Why are firms in the informal sector often less efficient than firms in the formal sector?

Correct Answer
verified
Entrepreneurs of the firms in the inform...
View Answer

Transfer payments are subtracted from national income to get to personal income.

Correct Answer
verified
False

The values of real GDP and real GNP are almost the same for the United States.

Correct Answer
verified

Table 8-16 -Refer to Table 8-16.Given the information above,what can we say has happened in the economy from 2015 to 2016?

Correct Answer
verified

Table 8-3 -Refer to Table 8-3.Consider the data above (in billions of dollars) for an economy: Gross domestic product (in billions of dollars) for this economy equals

Correct Answer
verified

Table 8-26 -Refer to Table 8-26.Given the information above,calculate the GDP deflator for both 2015 and 2016.What does the value of the deflator in the year 2015 tell you about that year with respect to the base year? What happened to prices in 2016 as compared to 2015?

Correct Answer
verified
To calculate the GDP deflator for 2012 a...
View Answer

Gross national product is defined as

Correct Answer
verified

The purchase by a foreign government of an airplane produced in the United States is included in U.S.

Correct Answer
verified

Suppose Bob works for Mary as a proofreader.Mary and Bob fall deeply in love,marry,and have eight children.Bob stops working for Mary in order to care for the children.What will be the effect on GDP?

Correct Answer
verified

Correct Answer
verified

Table 8-15 -Refer to Table 8-15.Consider the following data on nominal GDP and real GDP (values are in billions of dollars) : The GDP deflator for 2015 equals

Correct Answer
verified

Exam 8: Gdp: Measuring Total Production and Income

The values of real GDP and real GNP are almost the same in countries where a significant fraction of domestic production takes place in foreign-owned firms.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The factors of production include

Correct AnswerverifiedShow Answer

An example of business fixed investment spending is

Correct AnswerverifiedShow Answer

Between 2015 and 2016,if an economy's exports rise by $8 billion and its imports fall by $8 billion,by how much will GDP change between the two years,all else equal?

Correct AnswerverifiedC

If Gladys sells her 1998 Jeep Cherokee for $3,500 in 2016,the sale of her car contributes $3,500 to 2016 GDP.

Correct AnswerverifiedShow Answer

Nominal GDP measures the value of all final goods and services at base-year prices.

Correct AnswerverifiedShow Answer

China's current rate of GDP growth is quite rapid.Its current growth rate is probably three times that of the United States.However,the levels of pollution are much higher in China.Would you consider China to be better off than the United States given this information? Why or why not?

Which of the following is included in gross domestic product for an economy in a given year?

Correct AnswerverifiedShow Answer

The underground economy - the informal sector - can be a significant drag on the economies of developing countries.Why are firms in the informal sector often less efficient than firms in the formal sector?

Correct AnswerverifiedEntrepreneurs of the firms in the inform...View AnswerShow Answer

Transfer payments are subtracted from national income to get to personal income.

Correct AnswerverifiedFalse

The values of real GDP and real GNP are almost the same for the United States.

Correct AnswerverifiedShow Answer

Table 8-16 -Refer to Table 8-16.Given the information above,what can we say has happened in the economy from 2015 to 2016?

Correct AnswerverifiedShow Answer

Table 8-3 -Refer to Table 8-3.Consider the data above (in billions of dollars) for an economy: Gross domestic product (in billions of dollars) for this economy equals

Correct AnswerverifiedShow Answer

Table 8-26 -Refer to Table 8-26.Given the information above,calculate the GDP deflator for both 2015 and 2016.What does the value of the deflator in the year 2015 tell you about that year with respect to the base year? What happened to prices in 2016 as compared to 2015?

Correct AnswerverifiedTo calculate the GDP deflator for 2012 a...View AnswerShow Answer

Gross national product is defined as

Correct AnswerverifiedShow Answer

The purchase by a foreign government of an airplane produced in the United States is included in U.S.

Correct AnswerverifiedShow Answer

Suppose Bob works for Mary as a proofreader.Mary and Bob fall deeply in love,marry,and have eight children.Bob stops working for Mary in order to care for the children.What will be the effect on GDP?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 8-15 -Refer to Table 8-15.Consider the following data on nominal GDP and real GDP (values are in billions of dollars) : The GDP deflator for 2015 equals

Correct AnswerverifiedShow Answer

Correct Answer
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C

Correct Answer
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Correct Answer
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Correct Answer
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Entrepreneurs of the firms in the inform...
View Answer

Correct Answer
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False

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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To calculate the GDP deflator for 2012 a...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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