Question 1

Suppose an economy produces only burgers and bags of fries. In 2010, 4000 burgers are sold at $3 each and 6000 bags of fires are sold at $1.50 each. In 2008, the base year, burgers sold for $2.50 each and bags of fries sold for $2 each.

Accepted Answer

A)   nominal GDP is $22,000, real GDP is $21,000, and the GDP deflator is 95.45.
B)   nominal GDP is $22,000, real GDP is $21,000, and the GDP deflator is 104.77.
C)   nominal GDP is $21,000, real GDP is $22,000, and the GDP deflator is 95.45.
D)   nominal GDP is $21,000, real GDP is $22,000, and the GDP deflator is 104.77.E) A) and B)
F) B) and C)

Question 2

Wholesome Wheat Bakery buys $10.00 worth of flour from Mikes' Mill and uses the flour to make bread. Wholesome Wheat sells the bread to the public for $22.00. Taking these two transactions into account, what is the effect on GDP?

Accepted Answer

A)   GDP increases by $10.00
B)   GDP increases by $12.00
C)   GDP increases by $22.00
D)   GDP increases by $32.00E) None of the above
F) A) and D)

Question 3

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

Accepted Answer

A)   income falls and saving rises.
B)   income and saving both fall.
C)   income falls and expenditure rises.
D)   income and expenditure both fall.E) A) and D)
F) B) and D)

Question 4

U.S. GDP

Accepted Answer

A)   includes production of foreigners working in the U.S. and production by U.S. residents working in foreign countries.
B)   includes production of foreigners working in the U.S. but excludes production by U.S. residents working in foreign countries.
C)   excludes production of foreigners working in the U.S. but includes production by U.S. residents working in foreign countries.
D)   excludes production of foreigners working in the U.S. and production by U.S. residents working in foreign countries.E) A) and C)
F) B) and D)

Question 5

Alexandria, a British citizen, owns and manages a fish and chips shop in Washington, D.C.
She buys fresh food produced by U.S. workers, pays utilities to a U.S. company, and employs only U.S. citizens. What part, if any, of the restaurant's production is included in U.S. GDP? What part, if any, of the restaurant's production is included in U.S. GNP?

Accepted Answer

All of the output is included ...

Question 6

Table 23-6
The table below contains data for the country of Batterland, which produces only waffles and pancakes. The base year is 2013.
 
-Refer to Table 23-6. In 2011, this country's real GDP was

Accepted Answer

A)   $320.
B)   $440.
C)   $760.
D)   $770.E) A) and C)
F) B) and D)

Question 7

If in some year nominal GDP was $18 billion and the GDP deflator was 120, what was real GDP?

Accepted Answer

A)   $6.7 billion.
B)   $15 billion.
C)   $21.6 billion.
D)   $38 billion.E) All of the above
F) A) and B)

Question 8

Write the formula for calculating a GDP deflator using only nominal and real GDP.

Accepted Answer

The answer of Write the formula for calculating a GDP...

Question 9

In years of economic contraction, firms throughout the economy increase their production of goods and services, employment rises, and jobs are easy to find.

Accepted Answer

A) True 
 B)False

Question 10

Suppose an economy's production consists only of corn and soybeans. In 2010, 20 bushels of corn are sold at $4 per bushel and 10 bushels of soybeans are sold at $2 per bushel. In 2009, the price of corn was $2 per bushel and the price of soybeans was $1 per bushel. Using 2009 as the base year, it follows that, for 2010,

Accepted Answer

A)   nominal GDP is $50, real GDP is $100, and the GDP deflator is 50.
B)   nominal GDP is $50, real GDP is $100, and the GDP deflator is 200.
C)   nominal GDP is $100, real GDP is $50, and the GDP deflator is 50.
D)   nominal GDP is $100, real GDP is $50, and the GDP deflator is 200.E) A) and B)
F) A) and C)

Question 11

What are transfer payments, and how do they affect the calculation of GDP?

Accepted Answer

Transfer payments are income b...

Question 12

For an economy as a whole,

Accepted Answer

A)   wages must equal profit.
B)   consumption must equal income.
C)   income must equal expenditure.
D)   consumption must equal saving.E) B) and D)
F) A) and D)

Question 13

Table 23-1
The table below contains data for Chereaux for the year 2015.
 
-Refer to Table 23-1. Disposable personal income for Chereaux in 2015 is

Accepted Answer

A)   $190.
B)   $211.
C)   $130.
D)   $141.E) A) and D)
F) None of the above

Question 14

Real GDP will increase

Accepted Answer

A)   only when prices increase.
B)   only when output increases.
C)   when prices increase or output increases.
D)   All of the above are correct.E) All of the above
F) A) and C)

Question 15

GDP is equal to

Accepted Answer

A)   the market value of all final goods and services produced within a country in a given period of time.
B)   Y.
C)   C + I + G + NX.
D)   All of the above are correct.E) None of the above
F) All of the above

Question 16

Gross domestic product measures

Accepted Answer

A)   income and expenditures.
B)   income but not expenditures.
C)   expenditures but not income.
D)   neither income nor expenditures.E) B) and D)
F) All of the above

Question 17

Estimates of the values of which of the following non-market goods or services are included in GDP?

Accepted Answer

A)   unpaid housework but not the rental value of owner-occupied homes.
B)   the rental value of owner-occupied homes but not unpaid housework.
C)   unpaid housework and the rental value of owner-occupied homes.
D)   Neither unpaid housework nor the rental value of owner-occupied homes.E) B) and D)
F) A) and D)

Question 18

The city of Ann Arbor Michigan buys a police car manufactured in Germany. In the GDP accounts this transaction is included in

Accepted Answer

A)   in government expenditures and exports.
B)   government expenditures and imports.
C)   exports, but not government expenditures.
D)   imports, but not government expenditures.E) None of the above
F) B) and C)

Question 19

Table 23-8
A country produces only meat and potatoes in the quantities and prices listed below. Use 2011 as the base year.
 
-Refer to Table 23-8. In 2012, nominal GDP is

Accepted Answer

A)   $191.50, and real GDP is $170.
B)   $157, and real GDP is $170.
C)   $191.50, and real GDP is $157.
D)   $170, and real GDP is $227.50.E) All of the above
F) C) and D)

Question 20

Suppose an economy produces only cheese and fish. In 2010, 20 units of cheese are sold at $5 each and 8 units of fish are sold at $50 each. In 2009, the base year, the price of cheese was $10 per unit and the price of fish was $75 per unit. For 2010,

Accepted Answer

A)   nominal GDP is $500, real GDP is $800, and the GDP deflator is 62.5.
B)   nominal GDP is $500, real GDP is $800, and the GDP deflator is 160.
C)   nominal GDP is $800, real GDP is $500, and the GDP deflator is 62.5.
D)   nominal GDP is $800, real GDP is $500, and the GDP deflator is 160.E) All of the above
F) A) and D)

Exam 5: Measuring a Nations Income

GDP is equal to

Correct Answer
verified

In years of economic contraction, firms throughout the economy increase their production of goods and services, employment rises, and jobs are easy to find.

Correct Answer
verified

Real GDP will increase

Correct Answer
verified

Wholesome Wheat Bakery buys $10.00 worth of flour from Mikes' Mill and uses the flour to make bread. Wholesome Wheat sells the bread to the public for $22.00. Taking these two transactions into account, what is the effect on GDP?

Correct Answer
verified

Correct Answer
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All of the output is included ...
View Answer

U.S. GDP

Correct Answer
verified

The city of Ann Arbor Michigan buys a police car manufactured in Germany. In the GDP accounts this transaction is included in

Correct Answer
verified

If in some year nominal GDP was $18 billion and the GDP deflator was 120, what was real GDP?

Correct Answer
verified

Table 23-8 A country produces only meat and potatoes in the quantities and prices listed below. Use 2011 as the base year. -Refer to Table 23-8. In 2012, nominal GDP is

Correct Answer
verified

Table 23-1 The table below contains data for Chereaux for the year 2015. -Refer to Table 23-1. Disposable personal income for Chereaux in 2015 is

Correct Answer
verified

What are transfer payments, and how do they affect the calculation of GDP?

Correct Answer
verified
Transfer payments are income b...
View Answer

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

Correct Answer
verified

For an economy as a whole,

Correct Answer
verified

Estimates of the values of which of the following non-market goods or services are included in GDP?

Correct Answer
verified

Suppose an economy produces only cheese and fish. In 2010, 20 units of cheese are sold at $5 each and 8 units of fish are sold at $50 each. In 2009, the base year, the price of cheese was $10 per unit and the price of fish was $75 per unit. For 2010,

Correct Answer
verified

Table 23-6 The table below contains data for the country of Batterland, which produces only waffles and pancakes. The base year is 2013. -Refer to Table 23-6. In 2011, this country's real GDP was

Correct Answer
verified

Suppose an economy produces only burgers and bags of fries. In 2010, 4000 burgers are sold at $3 each and 6000 bags of fires are sold at $1.50 each. In 2008, the base year, burgers sold for $2.50 each and bags of fries sold for $2 each.

Correct Answer
verified

Correct Answer
verified

Gross domestic product measures

Correct Answer
verified

Write the formula for calculating a GDP deflator using only nominal and real GDP.

Correct Answer
verified

Exam 5: Measuring a Nations Income

GDP is equal to

Correct AnswerverifiedShow Answer

In years of economic contraction, firms throughout the economy increase their production of goods and services, employment rises, and jobs are easy to find.

Correct AnswerverifiedShow Answer

Real GDP will increase

Correct AnswerverifiedShow Answer

Wholesome Wheat Bakery buys $10.00 worth of flour from Mikes' Mill and uses the flour to make bread. Wholesome Wheat sells the bread to the public for $22.00. Taking these two transactions into account, what is the effect on GDP?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedAll of the output is included ...View AnswerShow Answer

U.S. GDP

Correct AnswerverifiedShow Answer

The city of Ann Arbor Michigan buys a police car manufactured in Germany. In the GDP accounts this transaction is included in

Correct AnswerverifiedShow Answer

If in some year nominal GDP was $18 billion and the GDP deflator was 120, what was real GDP?

Correct AnswerverifiedShow Answer

Table 23-8 A country produces only meat and potatoes in the quantities and prices listed below. Use 2011 as the base year. -Refer to Table 23-8. In 2012, nominal GDP is

Correct AnswerverifiedShow Answer

Table 23-1 The table below contains data for Chereaux for the year 2015. -Refer to Table 23-1. Disposable personal income for Chereaux in 2015 is

Correct AnswerverifiedShow Answer

What are transfer payments, and how do they affect the calculation of GDP?

Correct AnswerverifiedTransfer payments are income b...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

For an economy as a whole,

Correct AnswerverifiedShow Answer

Estimates of the values of which of the following non-market goods or services are included in GDP?

Correct AnswerverifiedShow Answer

Suppose an economy produces only cheese and fish. In 2010, 20 units of cheese are sold at $5 each and 8 units of fish are sold at $50 each. In 2009, the base year, the price of cheese was $10 per unit and the price of fish was $75 per unit. For 2010,

Correct AnswerverifiedShow Answer

Table 23-6 The table below contains data for the country of Batterland, which produces only waffles and pancakes. The base year is 2013. -Refer to Table 23-6. In 2011, this country's real GDP was

Correct AnswerverifiedShow Answer

Suppose an economy produces only burgers and bags of fries. In 2010, 4000 burgers are sold at $3 each and 6000 bags of fires are sold at $1.50 each. In 2008, the base year, burgers sold for $2.50 each and bags of fries sold for $2 each.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Gross domestic product measures

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Write the formula for calculating a GDP deflator using only nominal and real GDP.

Correct AnswerverifiedShow Answer

Correct Answer
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All of the output is included ...
View Answer

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Transfer payments are income b...
View Answer

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