Question 1

A recession is always associated with

Accepted Answer

A)   the end of a war.
B)   slowly growing real GDP.
C)   rising inflation.
D)   declining real GDP.E) A) and D)
F) C) and D)

Question 2

Table 23-12
A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year.
 
-Refer to Table 23-12. Calculate the GDP deflator for 2012 and 2013.

Accepted Answer

GDP deflator is 127....

Question 3

An American soldier stationed in North Carolina receives a paycheck from the federal government for $300, which she uses to purchase a $100 MP3 player made in China by a Chinese firm and $200 for fruit and vegetables from a local farmers market. As a result, U.S. GDP increases by

Accepted Answer

A)   $200.
B)   $300.
C)   $500.
D)   $600.E) A) and B)
F) None of the above

Question 4

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) B) and C)
F) None of the above

Question 5

Table 23-12
A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year.
 
-Refer to Table 23-12. Calculate real and nominal GDP for the year 2012.

Accepted Answer

Nominal GD...

Question 6

Table 23-12
A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year.
 
-Refer to Table 23-12. Calculate the rate of inflation for 2012.

Accepted Answer

The answer of Table 23-12
A country produces only ice cream...

Question 7

A manufacturer produces 1 million televisions in the first quarter of the year. It sells 900,000 of them before the end of the first quarter, and holds the others in its warehouse. How will the 100,000 unsold televisions be treated in the GDP statistics?

Accepted Answer

A)   Since the televisions eventually will be bought by consumers, they will be included as consumption in the first quarter.
B)   Since the televisions were not purchased in the first quarter, they will be counted as an increase in second- quarter GDP.
C)   The televisions will be counted as a change in inventory in the first quarter and so will be included in first- quarter GDP.
D)   The televisions will be counted as a change in inventory in the first quarter, and when sold in the second quarter will raise second-quarter GDP.E) B) and D)
F) A) and B)

Question 8

When an American doctor opens a practice in Bermuda, his production there is part of U.S. GDP.

Accepted Answer

A) True 
 B)False

Question 9

Recessions are not associated with which of the following?

Accepted Answer

A)   increased bankruptcies
B)   falling profits
C)   falling incomes
D)   falling unemploymentE) A) and C)
F) None of the above

Question 10

The government computes measures of income other than GDP because these other measures usually tell different stories about overall economic conditions.

Accepted Answer

A) True 
 B)False

Question 11

In the actual economy, households

Accepted Answer

A)   spend all of their income.
B)   divide their income among spending, taxes, and saving.
C)   buy all goods and services produced in the economy.
D)   Both a)  and c)  are correct.E) C) and D)
F) A) and D)

Question 12

Other things equal, in countries with higher levels of real GDP per person, life expectancy and literacy rates are higher than in countries with lower levels of real GDP per person.

Accepted Answer

A) True 
 B)False

Question 13

If in some year nominal GDP was $20 billion and the GDP deflator was 50, what was real GDP?

Accepted Answer

A)   $2.5 billion.
B)   $10 billion.
C)   $40 billion.
D)   $100 billion.E) None of the above
F) A) and B)

Question 14

Disposable personal income is the income that households and noncorporate businesses have left after satisfying all their obligations to the government.

Accepted Answer

A) True 
 B)False

Question 15

Fine Edge manufactures lawn mowers. In 2014 it had $2 million worth of lawn mowers in inventory. In 2015 it sold $10 million worth of lawn mowers to consumers and had $1 million worth of lawn mowers in inventory. How much did the lawn mowers produced by Fine Edge add to GDP in 2015?

Accepted Answer

A)   $11 million
B)   $10 million
C)   $7 million
D)   $9 millionE) B) and C)
F) A) and B)

Question 16

GDP is used as the basic measure of a society's economic well-being. A better measure of the economic well-being of individuals in society is

Accepted Answer

A)   saving per person.
B)   GDP per person.
C)   government expenditures per person.
D)   investment per business firm.E) B) and C)
F) C) and D)

Question 17

Which of the following is not a correct statement about the growth of real GDP in the U.S. economy?

Accepted Answer

A)   Real GDP in 2009 was almost four times its 1965 level.
B)   Growth was steady between 1965 and 2009.
C)   Continued growth in real GDP enables the typical American to enjoy greater economic prosperity than his or her parents and grandparents did.
D)   The output of goods and services produced grew on average about 3 percent per year between 1965 and 2009.E) A) and B)
F) None of the above

Question 18

If a U.S. citizen buys a television made in Korea by a Korean firm, then

Accepted Answer

A)   U.S. net exports decrease and U.S. GDP decreases.
B)   U.S. net exports are unaffected and U.S. GDP decreases.
C)   U.S. net exports are unaffected and U.S. GDP is unaffected.
D)   U.S. net exports decrease and U.S. GDP is unaffected.E) B) and C)
F) A) and B)

Question 19

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)   Argentina, Bolivia, Peru
B)   Argentina, Peru, Bolivia
C)   Bolivia, Argentina, Peru
D)   Peru, Bolivia, ArgentinaE) B) and C)
F) A) and C)

Question 20

The U.S. buys $500 billion of goods and $250 billion of services from foreign countries. Foreign countries buy $250 billion of goods and $300 billion of services from the U.S. What is net exports?

Accepted Answer

The answer of The U.S. buys $500 billion of goods...

Exam 15: Measuring a Nations Income

When an American doctor opens a practice in Bermuda, his production there is part of U.S. GDP.

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The U.S. buys $500 billion of goods and $250 billion of services from foreign countries. Foreign countries buy $250 billion of goods and $300 billion of services from the U.S. What is net exports?

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GDP is used as the basic measure of a society's economic well-being. A better measure of the economic well-being of individuals in society is

Correct AnswerverifiedShow Answer

A recession is always associated with

Correct AnswerverifiedShow Answer

Table 23-12 A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year. -Refer to Table 23-12. Calculate the GDP deflator for 2012 and 2013.

Correct AnswerverifiedGDP deflator is 127....View AnswerShow Answer

Recessions are not associated with which of the following?

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Table 23-12 A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year. -Refer to Table 23-12. Calculate the rate of inflation for 2012.

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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?

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An American soldier stationed in North Carolina receives a paycheck from the federal government for $300, which she uses to purchase a $100 MP3 player made in China by a Chinese firm and $200 for fruit and vegetables from a local farmers market. As a result, U.S. GDP increases by

Correct AnswerverifiedShow Answer

The government computes measures of income other than GDP because these other measures usually tell different stories about overall economic conditions.

Correct AnswerverifiedShow Answer

In the actual economy, households

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Other things equal, in countries with higher levels of real GDP per person, life expectancy and literacy rates are higher than in countries with lower levels of real GDP per person.

Correct AnswerverifiedShow Answer

If in some year nominal GDP was $20 billion and the GDP deflator was 50, what was real GDP?

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Disposable personal income is the income that households and noncorporate businesses have left after satisfying all their obligations to the government.

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Which of the following is not a correct statement about the growth of real GDP in the U.S. economy?

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Fine Edge manufactures lawn mowers. In 2014 it had $2 million worth of lawn mowers in inventory. In 2015 it sold $10 million worth of lawn mowers to consumers and had $1 million worth of lawn mowers in inventory. How much did the lawn mowers produced by Fine Edge add to GDP in 2015?

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If a U.S. citizen buys a television made in Korea by a Korean firm, then

Correct AnswerverifiedShow Answer

Table 23-12 A country produces only ice cream and cake in the quantities and prices listed below. Use 2011 as the base year. -Refer to Table 23-12. Calculate real and nominal GDP for the year 2012.

Correct AnswerverifiedNominal GD...View AnswerShow Answer

A manufacturer produces 1 million televisions in the first quarter of the year. It sells 900,000 of them before the end of the first quarter, and holds the others in its warehouse. How will the 100,000 unsold televisions be treated in the GDP statistics?

Correct AnswerverifiedShow Answer

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GDP deflator is 127....
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Nominal GD...
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