Question 1

Table 23-4
The table below contains data for the country of Dachsland,which produces only pretzels and books.The base year is 2005.
 
-Refer to Table 23-4.Dachsland's inflation rate from 2007 to 2008 was

Accepted Answer

A)   15.4%.
B)   26.1%.
C)   45.5%.
D)   77.8%.E) C) and D)
F) All of the above

Question 2

The GDP deflator can be used to take inflation out of nominal GDP.

Accepted Answer

A) True 
 B)False

Question 3

During a presidential campaign,the incumbent argues that he should be reelected because nominal GDP grew by 12 percent during his 4-year term in office.You know that population grew by 4 percent over the period and that the GDP deflator increased by 6 percent during the past 4 years.You should conclude that real GDP per person

Accepted Answer

A)   grew by more than 12 percent.
B)   grew,but by less than 12 percent.
C)   was unchanged.
D)   decreased.E) A) and C)
F) B) and C)

Question 4

Which of the following is correct?

Accepted Answer

A)   Nominal GDP never equals real GDP.
B)   Nominal GDP always equals real GDP.
C)   Nominal GDP equals real GDP in the base year.
D)   Nominal GDP equals real GDP in all years but the base year.E) A) and D)
F) A) and C)

Question 5

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

Accepted Answer

A)   final goods and services that are purchased by the U.S.federal government
B)   intermediate goods that are produced in the U.S.but that are unsold at the end of the GDP accounting period
C)   goods and services produced by foreign citizens working in the U.S.
D)   All of the above are included in U.S.GDP.E) None of the above
F) All of the above

Question 6

When economists talk about growth in the economy,they measure that growth as the

Accepted Answer

A)   absolute change in nominal GDP from one period to another.
B)   percentage change in nominal GDP from one period to another.
C)   absolute change in real GDP from one period to another.
D)   percentage change in real GDP from one period to another.E) None of the above
F) All of the above

Question 7

The consumption component of GDP includes spending on

Accepted Answer

A)   durable goods and nondurable goods,but not spending on services.
B)   durable goods and services,but not spending on nondurable goods.
C)   nondurable goods and services,but not spending on durable goods.
D)   durable goods,nondurable goods,and services.E) C) and D)
F) B) and D)

Question 8

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

Accepted Answer

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

Question 9

The total sales of all firms in the economy for a year

Accepted Answer

A)   equals GDP for the year.
B)   is larger than GDP for the year.
C)   is smaller than GDP for the year.
D)   Any of the above is possible.E) A) and B)
F) A) and C)

Question 10

Which of the following correctly orders U.S.income measures from largest to smallest?

Accepted Answer

A)   disposable personal income,gross national product,national income,net national product,personal income
B)   personal income,net national product,national income,gross national product,disposable personal income
C)   gross national product,net national product,national income,personal income,disposable personal income
D)   disposable personal income,personal income,national income,net national product,gross national productE) A) and B)
F) B) and D)

Question 11

Which of the following events would cause GDP for 2007 to increase?

Accepted Answer

A)   In February 2007,Amanda sells a 1996 Honda Accord to Isabella.
B)   In February 2007,Amanda buys a ticket to visit a zoo in Florida.She visits the zoo in April 2007.
C)   In December 2007,Isabella eats onions that she harvested from her backyard garden in October 2007.
D)   All of the above are correct.E) B) and C)
F) A) and D)

Question 12

Table 23-5
The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2006.
 
-Refer to Table 23-5.Batterland's inflation rate from 2005 to 2006 was

Accepted Answer

A)   -25%.
B)   25%.
C)   33.3%.
D)   100%.E) B) and C)
F) A) and C)

Question 13

Table 23-5
The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2006.
 
-Refer to Table 23-5.In 2006,Batterland's nominal GDP was

Accepted Answer

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

Question 14

GDP is the most closely watched economic statistic because it is thought to be the best single measure of a society's economic well-being.

Accepted Answer

A) True 
 B)False

Question 15

The local Chevrolet dealership has an increase in inventory of 25 cars in 2006.In 2007,it sells all 25 cars.Which of the following statements is correct?

Accepted Answer

A)   The value of the cars in inventory will be counted as part of 2006 GDP,and the value of the cars sold in 2007 will not increase 2007 GDP.
B)   The value of the cars in inventory will not affect 2006 GDP,and the value of the cars sold in 2007 will increase 2007 GDP.
C)   The value of the cars in inventory will be counted as part of 2006 GDP,and the value of the cars sold in 2007 will increase 2007 GDP.
D)   The value of the cars in inventory will not affect 2006 GDP,and the value of the cars sold in 2007 will not increase 2007 GDP.E) B) and D)
F) C) and D)

Question 16

The inflation rate is the

Accepted Answer

A)   absolute change in real GDP from one period to another.
B)   percentage change in real GDP from one period to another.
C)   absolute change in the price level from one period to another.
D)   percentage change in the price level from one period to another.E) A) and B)
F) None of the above

Question 17

In the economy of Wrexington in 2008,consumption was $1000,exports were $100,government purchases were $450,imports were $150,and investment was $350.What was Wrexington's GDP in 2008?

Accepted Answer

A)   $1750
B)   $1850
C)   $1900
D)   $2050E) A) and B)
F) A) and D)

Question 18

The income that households and noncorporate businesses receive is called

Accepted Answer

A)   personal income.
B)   net national product.
C)   disposable personal income.
D)   national income.E) A) and B)
F) A) and C)

Question 19

When an American household purchases a bottle of Italian wine for $100,

Accepted Answer

A)   U.S.consumption does not change,U.S.net exports decrease by $100,and U.S.GDP decreases by $100.
B)   U.S.consumption does not change,U.S.net exports increase by $100,and U.S.GDP increases by $100.
C)   U.S.consumption increases by $100,U.S.net exports decrease by $100,and U.S.GDP does not change.
D)   U.S.consumption increases by $100,U.S.net exports do not change,and U.S.GDP increases by $100.E) B) and C)
F) A) and D)

Question 20

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) A) and D)
F) A) and B)

Exam 23: Measuring a Nations Income

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

Correct Answer
verified

GDP is the most closely watched economic statistic because it is thought to be the best single measure of a society's economic well-being.

Correct Answer
verified

The GDP deflator can be used to take inflation out of nominal GDP.

Correct Answer
verified

When an American household purchases a bottle of Italian wine for $100,

Correct Answer
verified

Which of the following correctly orders U.S.income measures from largest to smallest?

Correct Answer
verified

The total sales of all firms in the economy for a year

Correct Answer
verified

When economists talk about growth in the economy,they measure that growth as the

Correct Answer
verified

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

Correct Answer
verified

Changes in nominal GDP reflect

Correct Answer
verified

The income that households and noncorporate businesses receive is called

Correct Answer
verified

Table 23-5 The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2006. -Refer to Table 23-5.Batterland's inflation rate from 2005 to 2006 was

Correct Answer
verified

Which of the following is correct?

Correct Answer
verified

The consumption component of GDP includes spending on

Correct Answer
verified

The local Chevrolet dealership has an increase in inventory of 25 cars in 2006.In 2007,it sells all 25 cars.Which of the following statements is correct?

Correct Answer
verified

In the economy of Wrexington in 2008,consumption was $1000,exports were $100,government purchases were $450,imports were $150,and investment was $350.What was Wrexington's GDP in 2008?

Correct Answer
verified

Correct Answer
verified

Table 23-5 The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2006. -Refer to Table 23-5.In 2006,Batterland's nominal GDP was

Correct Answer
verified

Table 23-4 The table below contains data for the country of Dachsland,which produces only pretzels and books.The base year is 2005. -Refer to Table 23-4.Dachsland's inflation rate from 2007 to 2008 was

Correct Answer
verified

Which of the following events would cause GDP for 2007 to increase?

Correct Answer
verified

The inflation rate is the

Correct Answer
verified

Exam 23: Measuring a Nations Income

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

Correct AnswerverifiedShow Answer

GDP is the most closely watched economic statistic because it is thought to be the best single measure of a society's economic well-being.

Correct AnswerverifiedShow Answer

The GDP deflator can be used to take inflation out of nominal GDP.

Correct AnswerverifiedShow Answer

When an American household purchases a bottle of Italian wine for $100,

Correct AnswerverifiedShow Answer

Which of the following correctly orders U.S.income measures from largest to smallest?

Correct AnswerverifiedShow Answer

The total sales of all firms in the economy for a year

Correct AnswerverifiedShow Answer

When economists talk about growth in the economy,they measure that growth as the

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Changes in nominal GDP reflect

Correct AnswerverifiedShow Answer

The income that households and noncorporate businesses receive is called

Correct AnswerverifiedShow Answer

Table 23-5 The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2006. -Refer to Table 23-5.Batterland's inflation rate from 2005 to 2006 was

Correct AnswerverifiedShow Answer

Which of the following is correct?

Correct AnswerverifiedShow Answer

The consumption component of GDP includes spending on

Correct AnswerverifiedShow Answer

The local Chevrolet dealership has an increase in inventory of 25 cars in 2006.In 2007,it sells all 25 cars.Which of the following statements is correct?

Correct AnswerverifiedShow Answer

In the economy of Wrexington in 2008,consumption was $1000,exports were $100,government purchases were $450,imports were $150,and investment was $350.What was Wrexington's GDP in 2008?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 23-5 The table below contains data for the country of Batterland,which produces only waffles and pancakes.The base year is 2006. -Refer to Table 23-5.In 2006,Batterland's nominal GDP was

Correct AnswerverifiedShow Answer

Table 23-4 The table below contains data for the country of Dachsland,which produces only pretzels and books.The base year is 2005. -Refer to Table 23-4.Dachsland's inflation rate from 2007 to 2008 was

Correct AnswerverifiedShow Answer

Which of the following events would cause GDP for 2007 to increase?

Correct AnswerverifiedShow Answer

The inflation rate is the

Correct AnswerverifiedShow Answer

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