Question 1

Table 15-6
The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2009.
Prices and Quantities
 
-Refer to Table 15-6.In 2009,this country's real GDP was

Accepted Answer

A)   $100.
B)   $390.
C)   $400.
D)   $540.E) A) and D)
F) A) and B)

Question 2

Table 15-5
A hypothetical country of Lahland produces only movies and popcorn.Quantities and prices of these goods for the last several years are shown below.The base year is 2009.
Prices and Quantities
 
-Refer to Table 15-5 What was this country's real GDP in 2010?

Accepted Answer

A)   $8,800
B)   $10,500
C)   $10,600
D)   $12,200E) A) and D)
F) B) and C)

Question 3

Jackie,a Canadian citizen,works only in the United States.The value of the output she produces is

Accepted Answer

A)   included in both U.S.GDP and U.S.GNP.
B)   included in U.S.GDP,but it is not included in U.S.GNP.
C)   included in U.S.GNP,but it is not included in U.S.GDP.
D)   included in neither U.S.GDP nor U.S.GNP.E) None of the above
F) A) and C)

Question 4

Table 15-4
The country of Caspir produces only cereal and milk.Quantities and prices of these goods for the last several years are shown below.The base year is 2008.
Prices and Quantities
 
-Refer to Table 15-4.This country's output grew

Accepted Answer

A)   29.9% from 2008 to 2009.
B)   33.3% from 2009 to 2010.
C)   24.3% from 2009 to 2010.
D)   15.4% from 2010 to 2011.E) A) and C)
F) None of the above

Question 5

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) B) and C)
F) B) and D)

Question 6

Which of the following is included in U.S.GDP?

Accepted Answer

A)   the value of production by a Singaporean working in the U.S.
B)   the value of production by an American working in Singapore
C)   Both (a) and (b) are correct.
D)   Neither (a) nor (b) is correct.E) A) and B)
F) A) and C)

Question 7

Ralph pays someone to mow his lawn,while Mike mows his own lawn.Regarding these two practices,which of the following statements is correct?

Accepted Answer

A)   Only Ralph's payments are included in GDP.
B)   Ralph's payments as well as the estimated value of Mike's mowing services are included in GDP.
C)   Neither Ralph's payments nor the estimated value of Mike's mowing services is included in GDP.
D)   Ralph's payments are included in GDP,while the estimated value of Mike's mowing services is included in GDP only if Mike voluntarily provides his estimate of that value to the government.E) B) and D)
F) None of the above

Question 8

Much of macroeconomics attempts to explain

Accepted Answer

A)   changes in the price of oil and gasoline.
B)   long-run growth and short-run fluctuations in real GDP.
C)   changes in the growth rate of state government spending.
D)   changes in the prices and quantities of individual goods and services.E) A) and B)
F) All of the above

Question 9

In 2009,the level of U.S.real GDP was close to four times its 1965 level.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following newspaper headlines is more closely related to what microeconomists study than to what macroeconomists study?

Accepted Answer

A)   Unemployment rate rises from 5 percent to 5.5 percent.
B)   Real GDP grows by 3.1 percent in the third quarter.
C)   Retail sales at stores show large gains.
D)   The price of oranges rises after an early frost.E) A) and D)
F) A) and B)

Question 11

Which of the following items is the one type of household expenditure that is categorized as investment rather than consumption?

Accepted Answer

A)   spending on education
B)   the purchase of stocks and bonds
C)   the purchase of a new house
D)   the purchase of durable goods such as stoves and washing machinesE) B) and C)
F) A) and D)

Question 12

Unemployment compensation is

Accepted Answer

A)   part of GDP because it represents income.
B)   part of GDP because the recipients must have worked in the past to qualify.
C)   not part of GDP because it is a transfer payment.
D)   not part of GDP because the payments reduce business profits.E) A) and C)
F) B) and C)

Question 13

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 14

Real GDP evaluates current production using prices that are fixed at past levels and therefore shows how the economy's overall production of goods and services changes over time.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following transactions would be included in GDP for 2010?

Accepted Answer

A)   In February 2010,Amanda sells a 1996 Honda Accord to Isabella.
B)   In February 2010,Amanda buys a ticket to visit a zoo in Florida.She visits the zoo in April 2011.
C)   In December 2010,Isabella eats onions that she harvested from her backyard garden in October 2010.
D)   All of the above are correct.E) C) and D)
F) B) and D)

Question 16

For an economy as a whole,income must exceed expenditure.

Accepted Answer

A) True 
 B)False

Question 17

If real GDP doubles and the GDP deflator doubles,then nominal GDP

Accepted Answer

A)   remains constant.
B)   doubles.
C)   triples.
D)   quadruples.E) A) and D)
F) A) and C)

Question 18

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 B)
F) B) and C)

Question 19

GDP can measure either the total income of everyone in the economy or the total expenditure on the economy's output of goods and services,but GDP cannot measure both at the same time.

Accepted Answer

A) True 
 B)False

Question 20

GDP is not a perfect measure of well-being; for example,

Accepted Answer

A)   GDP excludes the value of volunteer work.
B)   GDP does not address the distribution of income.
C)   GDP does not address environmental quality.
D)   All of the above are correct.E) A) and B)
F) B) and C)

Exam 15: Measuring a Nations Income

U.S.GDP

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Table 15-4 The country of Caspir produces only cereal and milk.Quantities and prices of these goods for the last several years are shown below.The base year is 2008. Prices and Quantities -Refer to Table 15-4.This country's output grew

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Real GDP evaluates current production using prices that are fixed at past levels and therefore shows how the economy's overall production of goods and services changes over time.

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If real GDP doubles and the GDP deflator doubles,then nominal GDP

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GDP is not a perfect measure of well-being; for example,

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Which of the following is included in U.S.GDP?

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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

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Which of the following transactions would be included in GDP for 2010?

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In 2009,the level of U.S.real GDP was close to four times its 1965 level.

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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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Table 15-5 A hypothetical country of Lahland produces only movies and popcorn.Quantities and prices of these goods for the last several years are shown below.The base year is 2009. Prices and Quantities -Refer to Table 15-5 What was this country's real GDP in 2010?

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GDP can measure either the total income of everyone in the economy or the total expenditure on the economy's output of goods and services,but GDP cannot measure both at the same time.

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Which of the following items is the one type of household expenditure that is categorized as investment rather than consumption?

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For an economy as a whole,income must exceed expenditure.

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Which of the following newspaper headlines is more closely related to what microeconomists study than to what macroeconomists study?

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Unemployment compensation is

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Ralph pays someone to mow his lawn,while Mike mows his own lawn.Regarding these two practices,which of the following statements is correct?

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Jackie,a Canadian citizen,works only in the United States.The value of the output she produces is

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Table 15-6 The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2009. Prices and Quantities -Refer to Table 15-6.In 2009,this country's real GDP was

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Much of macroeconomics attempts to explain

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