Question 1

Which of the following measures can give some indication of the quality of life in an economy?

Accepted Answer

A)  Child mortality
B)  Literacy rates
C)  Life expectancy
D)  All of these are measures used to assess quality of life.E) A) and D)
F) All of the above

Question 2

If imports are $4 billion and net exports are $4 billion,what must be the value of exports?

Accepted Answer

A)  $0 billion
B)  $8 billion
C)  $4 billion
D)  $2 billionE) None of the above
F) B) and D)

Question 3

If a country experiences a negative growth rate in real GDP,it means:

Accepted Answer

A)  people are producing less than they did the year before.
B)  the economy is shrinking.
C)  there are less goods to allocate in the economy than before.
D)  All of these statements are true.E) A) and D)
F) A) and C)

Question 4

The size of the underground economy is larger when:

Accepted Answer

A)  the cost of doing business legally is high.
B)  bribes are often necessary to cut through bureaucratic red tape.
C)  taxes are extremely high.
D)  All of these statements are true.E) B) and C)
F) A) and D)

Question 5

Jake,Sr.sells the family business,a factory that produces snake oil,to Jake,Jr. ,for $100,even though the factory has been assessed at $400,000.How will this transaction affect GDP?

Accepted Answer

A)  Investment will increase by $100.
B)  Investment will increase by $400,000.
C)  Consumption will increase by $400,000.
D)  GDP will not be affected by the transaction.E) All of the above
F) A) and D)

Question 6

U.S.GDP increased from $12.5 trillion in 2005 to $14 trillion in 2009.This means that:

Accepted Answer

A)  people in the U.S.produced more goods and services in 2009 than in 2005.
B)  the prices of all goods and services were higher in 2009 than in 2005.
C)  Either of these could be true.
D)  Both of these must be true.E) B) and C)
F) A) and B)

Question 7

We can measure total production by:

Accepted Answer

A)  adding up what people spend on final goods and services.
B)  adding up everyone's asset wealth.
C)  comparing cost of inputs to final sale price.
D)  None of these statements is true.E) All of the above
F) A) and C)

Question 8

U.S.Gross Domestic Product includes:

Accepted Answer

A)  goods produced by foreign firms on U.S.soil.
B)  goods produced by U.S.firms on foreign soil.
C)  goods produced by foreign firms on foreign soil.
D)  None of these statements is true.E) B) and C)
F) C) and D)

Question 9

Which of the following is an intermediate good?

Accepted Answer

A)  Tomatoes grown in your garden that you use to make salsa
B)  Tomatoes you buy at a local farmer's stand that you use to make salsa
C)  Tomatoes sold in the grocery store that you use to make salsa
D)  None of these is an intermediate good.E) A) and C)
F) B) and D)

Question 10

The goods and services that count toward GDP are:

Accepted Answer

A)  defined in terms of the location of production,not the citizenship of the producer.
B)  defined in terms of the citizenship of the producer,not the location of production.
C)  defined in terms of citizens producing within a country's borders.
D)  defined in terms of total production of companies owned by citizens,regardless of the actual location of production.E) A) and B)
F) A) and C)

Question 11

Everyone in an economy tends to do better when we experience:

Accepted Answer

A)  high economic growth,low unemployment,and high inflation.
B)  steady economic growth,low unemployment,and stable prices.
C)  steady economic growth,high unemployment,and stable prices.
D)  high economic growth,high unemployment,and low inflation.E) A) and D)
F) B) and C)

Question 12

Ace has always been a top student,so it was no surprise he won a $1,500 scholarship from the company where he worked summers to help with college expenses.Ace decides to spend his scholarship money on a new Apple Macbook before heading off to college in the fall.How will GDP be affected by Ace's recent purchases?

Accepted Answer

A)  Consumption will go up by $1,500,because a computer is a durable good.
B)  Investment will go up by $1,500,because a computer is a durable good.
C)  GDP will not be affected,since Ace acquired the computer with scholarship money.
D)  Consumption will go up by $1,500,because a computer is a nondurable good.E) A) and B)
F) All of the above

Question 13

In the United States the underground economy has been valued at around:

Accepted Answer

A)  7 percent or 8 percent of GDP.
B)  2 percent or 3 percent of GDP.
C)  5 percent to 6 percent of GDP.
D)  9 percent to 10 percent of GDP.E) None of the above
F) A) and B)

Question 14

An activity that would not be included in GDP would be:

Accepted Answer

A)  a sweater you knit for your roommate for her birthday.
B)  getting tomatoes from your garden and making salsa with them.
C)  cleaning your house.
D)  None of these would be included in GDP.E) A) and D)
F) B) and C)

Question 15

Investment,as a part of GDP,includes:

Accepted Answer

A)  stocks.
B)  bonds.
C)  Both of these are included in investment.
D)  Neither of these is included in investment.E) All of the above
F) A) and D)

Question 16

The government office that declares official periods of recession and depression is the:

Accepted Answer

A)  National Bureau of Economic Research.
B)  Bureau of Labor Statistics.
C)  Congressional Budget Office.
D)  Federal Reserve Board.E) All of the above
F) None of the above

Question 17

GDP per capita:

Accepted Answer

A)  is an average income per person in an economy.
B)  tells us about how the output is allocated in an economy.
C)  tells us about what you can buy with a given amount of money in that country.
D)  All of these statements are true.E) A) and B)
F) A) and C)

Question 18

Consumption,as a component of GDP:

Accepted Answer

A)  measures spending on goods and services by private individuals and households.
B)  includes nondurable goods only.
C)  includes durable goods only.
D)  measures spending only on goods,not services,by private individuals and households.E) All of the above
F) None of the above

Question 19

A consumption good that would be counted in GDP would be:

Accepted Answer

A)  the coffee Cyndi buys on her way to work in the morning.
B)  Cyndi's brand new car.
C)  the sunglasses Cyndi bought on clearance sale yesterday.
D)  All of these will be counted as consumption in GDP.E) A) and B)
F) A) and C)

Question 20

GDP:

Accepted Answer

A)  gives us a sense of the well-being of the average person in a country.
B)  allows us to gauge the direction an economy is headed when we examine changes in GDP over time.
C)  measures the value of a national economy.
D)  All of these statements are true.E) A) and D)
F) C) and D)

Exam 24: Measuring the Wealth of Nations

U.S.GDP increased from $12.5 trillion in 2005 to $14 trillion in 2009.This means that:

Correct Answer
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The size of the underground economy is larger when:

Correct Answer
verified

U.S.Gross Domestic Product includes:

Correct Answer
verified

If imports are $4 billion and net exports are $4 billion,what must be the value of exports?

Correct Answer
verified

The government office that declares official periods of recession and depression is the:

Correct Answer
verified

Jake,Sr.sells the family business,a factory that produces snake oil,to Jake,Jr. ,for $100,even though the factory has been assessed at $400,000.How will this transaction affect GDP?

Correct Answer
verified

Which of the following measures can give some indication of the quality of life in an economy?

Correct Answer
verified

Everyone in an economy tends to do better when we experience:

Correct Answer
verified

Correct Answer
verified

The goods and services that count toward GDP are:

Correct Answer
verified

Consumption,as a component of GDP:

Correct Answer
verified

GDP:

Correct Answer
verified

Investment,as a part of GDP,includes:

Correct Answer
verified

In the United States the underground economy has been valued at around:

Correct Answer
verified

GDP per capita:

Correct Answer
verified

An activity that would not be included in GDP would be:

Correct Answer
verified

We can measure total production by:

Correct Answer
verified

A consumption good that would be counted in GDP would be:

Correct Answer
verified

If a country experiences a negative growth rate in real GDP,it means:

Correct Answer
verified

Which of the following is an intermediate good?

Correct Answer
verified

Exam 24: Measuring the Wealth of Nations

U.S.GDP increased from $12.5 trillion in 2005 to $14 trillion in 2009.This means that:

Correct AnswerverifiedShow Answer

The size of the underground economy is larger when:

Correct AnswerverifiedShow Answer

U.S.Gross Domestic Product includes:

Correct AnswerverifiedShow Answer

If imports are $4 billion and net exports are $4 billion,what must be the value of exports?

Correct AnswerverifiedShow Answer

The government office that declares official periods of recession and depression is the:

Correct AnswerverifiedShow Answer

Jake,Sr.sells the family business,a factory that produces snake oil,to Jake,Jr. ,for $100,even though the factory has been assessed at $400,000.How will this transaction affect GDP?

Correct AnswerverifiedShow Answer

Which of the following measures can give some indication of the quality of life in an economy?

Correct AnswerverifiedShow Answer

Everyone in an economy tends to do better when we experience:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The goods and services that count toward GDP are:

Correct AnswerverifiedShow Answer

Consumption,as a component of GDP:

Correct AnswerverifiedShow Answer

GDP:

Correct AnswerverifiedShow Answer

Investment,as a part of GDP,includes:

Correct AnswerverifiedShow Answer

In the United States the underground economy has been valued at around:

Correct AnswerverifiedShow Answer

GDP per capita:

Correct AnswerverifiedShow Answer

An activity that would not be included in GDP would be:

Correct AnswerverifiedShow Answer

We can measure total production by:

Correct AnswerverifiedShow Answer

A consumption good that would be counted in GDP would be:

Correct AnswerverifiedShow Answer

If a country experiences a negative growth rate in real GDP,it means:

Correct AnswerverifiedShow Answer

Which of the following is an intermediate good?

Correct AnswerverifiedShow Answer

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