Question 1

Ryan lives in an apartment where he pays $7,000 a year in rent. Sarah lives in a house that could be rented for $21,000 a year. How much do these housing services contribute to GDP?

Accepted Answer

A)   $21,000
B)   $28,000
C)   $7,000
D)   $14,000E) B) and D)
F) B) and C)

Question 2

Table 23-11
The country of Batavia produces only chocolates and watches. Below is a table with recent information on Batavia production and prices. The base year is 2009.

-Refer to Table 23-11.
What was the inflation rate for 2011? Show your work.

Accepted Answer

For 2010 the GDP Deflator was 112. Nomin...

Question 3

Explain how GNP differs from GDP.

Accepted Answer

GNP includes income from a nat...

Question 4

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?

Accepted Answer

A)   Ghana, Kenya, Tanzania
B)   Ghana, Tanzania, Kenya
C)   Kenya, Tanzania, Ghana
D)   Kenya, Ghana, TanzaniaE) A) and B)
F) None of the above

Question 5

If Brazil buys $100 million of tractors from the U.S., then U.S. net exports will decrease.

Accepted Answer

A) True 
 B)False

Question 6

Consider the following three items of spending by the government: i)  the federal government pays a $500 unemployment benefit to an unemployed person; ii)  the federal government makes a $2,000 salary payment to a Navy lieutenant; iii)  the city of Bozeman, Montana makes a $10,000 payment to ABC Lighting Company for street lights in Bozeman. Which of these payments contributes directly to government purchases in the national income accounts?

Accepted Answer

A)   only item i) 
B)   only item ii) 
C)   only items i)  and ii) 
D)   only items ii)  and iii) E) B) and C)
F) B) and D)

Question 7

In a simple circular-flow diagram,

Accepted Answer

A)   households spend all of their income.
B)   all goods and services are bought by households.
C)   expenditures flow through the markets for goods and services, while income flows through the markets for the factors of production.
D)   All of the above are correct.E) All of the above
F) C) and D)

Question 8

Sally purchased a log-splitter five years ago. This year, she purchases some new parts, gasoline, oil, and spends 2 hours repairing the log-splitter. Which of the following is included in this year's GDP?

Accepted Answer

A)   the amount she paid to buy the new parts
B)   the amount she paid to buy new parts and gasoline
C)   the amount she paid to buy new parts, gasoline, and oil.
D)   the amount she paid to buy new parts, gasoline, oil, and the market value of the 2 hours spent to repair the log-splitter.E) All of the above
F) A) and D)

Question 9

Which of the following is not an example of a durable good?

Accepted Answer

A)   a refrigerator.
B)   an automobile.
C)   a business suit.
D)   a furnace.E) C) and D)
F) B) and D)

Question 10

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 11

GDP per person tells us the income and expenditure of the

Accepted Answer

A)   richest person in the economy.
B)   poorest person in the economy.
C)   average person in the economy.
D)   entire economy.E) A) and D)
F) A) and C)

Question 12

If a U.S. citizen buys a dress made in Nepal by a Nepalese firm, then

Accepted Answer

A)   U.S. consumption increases, U.S. net exports decrease, and U.S. GDP decreases.
B)   U.S. consumption increases, U.S. net exports decrease, and U.S. GDP is unaffected.
C)   U.S. consumption decreases, U.S. net exports increase, and U.S. GDP increases.
D)   U.S. consumption decreases, U.S. net exports increase, and U.S. GDP is unaffected.E) A) and D)
F) None of the above

Question 13

If foreign citizens earn less income in the U.S. than U.S. citizens earn in foreign countries,

Accepted Answer

A)   U.S. net factor payments from abroad are positive, and its GDP is larger than its GNP.
B)   U.S. net factor payments from abroad are positive, and its GNP is larger than its GDP.
C)   U.S. net factor payments from abroad are negative, and its GDP is larger than its GNP.
D)   U.S. net factor payments from abroad are negative, and its GNP is larger than its GDP.E) All of the above
F) C) and D)

Question 14

Figure 23-2. 
-Refer to Figure 23-2. Identify the location for markets for factors of production and markets for goods and services.

Accepted Answer

X is markets for fac...

Question 15

How does U.S. gross domestic product GDP)  differ from U.S. gross national product GNP) ?

Accepted Answer

A)   GNP = GDP - losses from depreciation
B)   GNP = GDP + income earned by U.S. citizens abroad - income that foreign citizens earned in the U.S.
C)   GNP = GDP + transfer payments to households + - indirect sales taxes
D)   GNP = GDP - depreciation - retained earningsE) C) and D)
F) All of the above

Question 16

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 trillion.E) None of the above
F) A) and B)

Question 17

Table 23-4
The table below reports nominal and real GDP for the U.S. from 1929 to 1932.
 
-Refer to Table 23-4. If prices had remained constant between 1929 and 1930, Nominal GDP would have decreased

Accepted Answer

A)   8.62%.
B)   9.43%.
C)   11.97%.
D)   13.6%.E) A) and D)
F) C) and D)

Question 18

A farmer sells $25,000 worth of apples to individuals who take them home to eat, $50,000 worth of apples to a company that uses them all to produce cider, and $75,000 worth of apples to a grocery store that will sell them to households. How much of the farmer's sales will be included as apples in GDP?

Accepted Answer

A)   $25,000
B)   $150,000
C)   $100,000
D)   $125,000E) B) and D)
F) None of the above

Question 19

Table 23-4
The table below reports nominal and real GDP for the U.S. from 1929 to 1932.
 
-Refer to Table 23-4. What was the growth rate of real GDP for 1930?

Accepted Answer

A)   -8.62%. Real GDP is a better gauge of economic well-being than nominal GDP.
B)   -8.62%. Nominal GDP is a better gauge of economic well-being than real GDP.
C)   -9.43%. Real GDP is a better gauge of economic well-being than nominal GDP.
D)   -9.43%. Nominal GDP is a better gauge of economic well-being than real GDP.E) B) and D)
F) B) and C)

Question 20

Grapes are considered intermediate goods

Accepted Answer

A)   whether the purchaser uses them to make wine to sell or eats them.
B)   if the purchaser uses them to make wine to sell others but not if the purchaser eats them.
C)   if the purchaser eats them, but not if the purchaser uses to them to make wine to sell.
D)   None of the above is correct.E) A) and B)
F) A) and C)

Exam 15: Measuring a Nations Income

Table 23-4 The table below reports nominal and real GDP for the U.S. from 1929 to 1932. -Refer to Table 23-4. If prices had remained constant between 1929 and 1930, Nominal GDP would have decreased

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

Correct Answer
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Figure 23-2. -Refer to Figure 23-2. Identify the location for markets for factors of production and markets for goods and services.

Correct Answer
verified
X is markets for fac...
View Answer

If a U.S. citizen buys a dress made in Nepal by a Nepalese firm, then

Correct Answer
verified

Explain how GNP differs from GDP.

Correct Answer
verified
GNP includes income from a nat...
View Answer

GDP per person tells us the income and expenditure of the

Correct Answer
verified

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?

Correct Answer
verified

How does U.S. gross domestic product GDP) differ from U.S. gross national product GNP) ?

Correct Answer
verified

Sally purchased a log-splitter five years ago. This year, she purchases some new parts, gasoline, oil, and spends 2 hours repairing the log-splitter. Which of the following is included in this year's GDP?

Correct Answer
verified

Grapes are considered intermediate goods

Correct Answer
verified

Ryan lives in an apartment where he pays $7,000 a year in rent. Sarah lives in a house that could be rented for $21,000 a year. How much do these housing services contribute to GDP?

Correct Answer
verified

Table 23-4 The table below reports nominal and real GDP for the U.S. from 1929 to 1932. -Refer to Table 23-4. What was the growth rate of real GDP for 1930?

Correct Answer
verified

Which of the following is not an example of a durable good?

Correct Answer
verified

In a simple circular-flow diagram,

Correct Answer
verified

Table 23-11 The country of Batavia produces only chocolates and watches. Below is a table with recent information on Batavia production and prices. The base year is 2009. -Refer to Table 23-11. What was the inflation rate for 2011? Show your work.

Correct Answer
verified
For 2010 the GDP Deflator was 112. Nomin...
View Answer

If foreign citizens earn less income in the U.S. than U.S. citizens earn in foreign countries,

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

If Brazil buys $100 million of tractors from the U.S., then U.S. net exports will decrease.

Correct Answer
verified

Exam 15: Measuring a Nations Income

Table 23-4 The table below reports nominal and real GDP for the U.S. from 1929 to 1932. -Refer to Table 23-4. If prices had remained constant between 1929 and 1930, Nominal GDP would have decreased

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

Correct AnswerverifiedShow Answer

Figure 23-2. -Refer to Figure 23-2. Identify the location for markets for factors of production and markets for goods and services.

Correct AnswerverifiedX is markets for fac...View AnswerShow Answer

If a U.S. citizen buys a dress made in Nepal by a Nepalese firm, then

Correct AnswerverifiedShow Answer

Explain how GNP differs from GDP.

Correct AnswerverifiedGNP includes income from a nat...View AnswerShow Answer

GDP per person tells us the income and expenditure of the

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

How does U.S. gross domestic product GDP) differ from U.S. gross national product GNP) ?

Correct AnswerverifiedShow Answer

Sally purchased a log-splitter five years ago. This year, she purchases some new parts, gasoline, oil, and spends 2 hours repairing the log-splitter. Which of the following is included in this year's GDP?

Correct AnswerverifiedShow Answer

Grapes are considered intermediate goods

Correct AnswerverifiedShow Answer

Ryan lives in an apartment where he pays $7,000 a year in rent. Sarah lives in a house that could be rented for $21,000 a year. How much do these housing services contribute to GDP?

Correct AnswerverifiedShow Answer

Table 23-4 The table below reports nominal and real GDP for the U.S. from 1929 to 1932. -Refer to Table 23-4. What was the growth rate of real GDP for 1930?

Correct AnswerverifiedShow Answer

Which of the following is not an example of a durable good?

Correct AnswerverifiedShow Answer

In a simple circular-flow diagram,

Correct AnswerverifiedShow Answer

Table 23-11 The country of Batavia produces only chocolates and watches. Below is a table with recent information on Batavia production and prices. The base year is 2009. -Refer to Table 23-11. What was the inflation rate for 2011? Show your work.

Correct AnswerverifiedFor 2010 the GDP Deflator was 112. Nomin...View AnswerShow Answer

If foreign citizens earn less income in the U.S. than U.S. citizens earn in foreign countries,

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

If Brazil buys $100 million of tractors from the U.S., then U.S. net exports will decrease.

Correct AnswerverifiedShow 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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X is markets for fac...
View Answer

Correct Answer
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Correct Answer
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GNP includes income from a nat...
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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Correct Answer
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For 2010 the GDP Deflator was 112. Nomin...
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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