Question 1

Expenditures by households on education are included in the consumption component of GDP.

Accepted Answer

A) True 
 B)False

Question 2

Sally purchases a classic 1964 car she saw for sale on someone's lawn.She then purchases some new parts and spends 120 hours refurbishing the car which she keeps.Which of the following is included in GDP?

Accepted Answer

A)  the amount she paid to buy the car
B)  the amount she paid to buy new parts
C)  the value of her time repairing the car
D)  All of the above are included.E) A) and C)
F) B) and D)

Question 3

Total income from the domestic production of final goods and services equals

Accepted Answer

A)  only household expenditures for these goods.
B)  only household and business expenditures for these goods.
C)  only household and government expenditures for these goods.
D)  the expenditures for these goods whoever buys them.E) A) and B)
F) A) and C)

Question 4

If total spending rises from one year to the next,then which of the following could not be true?

Accepted Answer

A)  the economy is producing a smaller output of goods and services,and goods and services are selling at higher prices
B)  the economy is producing a larger output of goods and services,and goods and services are selling at lower prices
C)  the economy is producing a larger output of goods and services,and goods and services are selling at higher prices
D)  the economy is producing a smaller output of goods and services,and goods and services are selling at lower pricesE) All of the above
F) A) and D)

Question 5

The value of goods added to a firm's inventory in a certain year is treated as

Accepted Answer

A)  consumption,since the goods will be sold to consumers in another period.
B)  intermediate goods,and so is not included in that year's GDP.
C)  investment,since GDP aims to measure the value of the economy's production that year.
D)  spending on durable goods,since the goods could not be inventoried unless they were durable.E) All of the above
F) A) and B)

Question 6

In order to include many different goods and services in an aggregate measure,GDP is computed using,primarily,

Accepted Answer

A)  values of goods and services based on surveys of consumers.
B)  market prices.
C)  quantities purchased by a typical urban household.
D)  profits from producing goods and services.E) None of the above
F) A) and B)

Question 7

Which of the following statements about nominal GDP and real GDP is correct?

Accepted Answer

A)  Nominal GDP is a better gauge of economic well-being than real GDP.
B)  Real GDP is a better gauge of economic well-being than nominal GDP.
C)  Real GDP and nominal GDP are equally good measures of economic well-being.
D)  Neither nominal nor real GDP provide a measure of economic well-being.E) All of the above
F) A) and C)

Question 8

Which of the following questions is more likely to be studied by a microeconomist than a macroeconomist?

Accepted Answer

A)  Why do prices in general rise by more in some countries than in others?
B)  Why do wages differ across industries?
C)  Why do national production and income increase in some periods and not in others?
D)  How rapidly is GDP currently increasing?E) A) and B)
F) A) and C)

Question 9

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) A) and D)
F) None of the above

Question 10

Transactions involving items produced in the past,such as the sale of a 5-year-old automobile by a used car dealership or the purchase of an antique rocking chair by a person at a yard sale,are

Accepted Answer

A)  included in current GDP because GDP measures the value of all goods and services sold in the current year.
B)  included in current GDP but valued at their original prices.
C)  not included in current GDP because it is difficult to determine their value.
D)  not included in current GDP because GDP only measures the value of goods and services produced in the current year.E) None of the above
F) All of the above

Question 11

A country reported nominal GDP of $100 billion in 2010 and $75 billion in 2009.It also reported a GDP deflator of 125 in 2010 and 120 in 2009.Between 2009 and 2010,

Accepted Answer

A)  real output and the price level both rose.
B)  real output rose and the price level fell.
C)  real output fell and the price level rose.
D)  real output and the price level both fell.E) None of the above
F) A) and B)

Question 12

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 13

Changes in nominal GDP reflect

Accepted Answer

A)  only changes in prices.
B)  only changes in the amounts being produced.
C)  both changes in prices and changes in the amounts being produced.
D)  neither changes in prices nor changes in the amounts being produced.E) B) and C)
F) A) and D)

Exam 23: Measuring a Nations Income

Changes in nominal GDP reflect

Correct Answer
verified

Which of the following statements about nominal GDP and real GDP is correct?

Correct Answer
verified

The value of goods added to a firm's inventory in a certain year is treated as

Correct Answer
verified

Total income from the domestic production of final goods and services equals

Correct Answer
verified

In order to include many different goods and services in an aggregate measure,GDP is computed using,primarily,

Correct Answer
verified

Expenditures by households on education are included in the consumption component of GDP.

Correct Answer
verified

If total spending rises from one year to the next,then which of the following could not be true?

Correct Answer
verified

Which of the following questions is more likely to be studied by a microeconomist than a macroeconomist?

Correct Answer
verified

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

Correct Answer
verified

A country reported nominal GDP of $100 billion in 2010 and $75 billion in 2009.It also reported a GDP deflator of 125 in 2010 and 120 in 2009.Between 2009 and 2010,

Correct Answer
verified

Sally purchases a classic 1964 car she saw for sale on someone's lawn.She then purchases some new parts and spends 120 hours refurbishing the car which she keeps.Which of the following is included in GDP?

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

Transactions involving items produced in the past,such as the sale of a 5-year-old automobile by a used car dealership or the purchase of an antique rocking chair by a person at a yard sale,are

Correct Answer
verified

Exam 23: Measuring a Nations Income

Changes in nominal GDP reflect

Correct AnswerverifiedShow Answer

Which of the following statements about nominal GDP and real GDP is correct?

Correct AnswerverifiedShow Answer

The value of goods added to a firm's inventory in a certain year is treated as

Correct AnswerverifiedShow Answer

Total income from the domestic production of final goods and services equals

Correct AnswerverifiedShow Answer

In order to include many different goods and services in an aggregate measure,GDP is computed using,primarily,

Correct AnswerverifiedShow Answer

Expenditures by households on education are included in the consumption component of GDP.

Correct AnswerverifiedShow Answer

If total spending rises from one year to the next,then which of the following could not be true?

Correct AnswerverifiedShow Answer

Which of the following questions is more likely to be studied by a microeconomist than a macroeconomist?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A country reported nominal GDP of $100 billion in 2010 and $75 billion in 2009.It also reported a GDP deflator of 125 in 2010 and 120 in 2009.Between 2009 and 2010,

Correct AnswerverifiedShow Answer

Sally purchases a classic 1964 car she saw for sale on someone's lawn.She then purchases some new parts and spends 120 hours refurbishing the car which she keeps.Which of the following is included in GDP?

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

Transactions involving items produced in the past,such as the sale of a 5-year-old automobile by a used car dealership or the purchase of an antique rocking chair by a person at a yard sale,are

Correct AnswerverifiedShow Answer

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