Ch 5 Economics

which is the national income accounting identity

Y = C + I + G + X - M

which of the following goods and services would be excluded from personal consumption expenditures in the bureau of economic analysis statistics

a new house (any investments)

the consumer price index is an index computed using prices of a

fixed basket of goods used by the typical consumer

in the circular flow model, who supplies factors of production in exchange for income?

households

the percentage increase in the cost of living from one year to the next is the

inflation rate

which of the following are not counted as final goods and used in the GDP calculation

intermediate goods

which of these is not a shortcoming of GDP as a measure of welfare

it only counts final goods and services and not intermediate goods

the unemployment rate is specifically defined as the percentage of the

labor force that is unemployed

gross domestic product is best defined as the

market value of all final goods and services produced in a country during a period of time

a framework used to measure the level of aggregate economic activity in a country is known as

national income accounts

the GDP deflator is 100 times the ratio of

nominal GDP to real GDP

many economists believe the CPU ____ inflation because it fails to consider quality improvements in products

overstates

which of these is aggregate accounting identity

production=expenditure=income

which measure of GDP represents changes in the quantity of goods and services produced in the economy, holding prices constant?

real GDP

a decline in economic activity that lasts at least two consecutive quarters is known as

recession

which phase of the business cycle is characterized by increasing levels of unemployment

recessions

if Americans still worked sixty hour weeks, as they did in 1890

the GDP would be much higher than it is but the well being of the typical person would not necessarily be higher

which is the largest component of GDP

consumption

as the value of a country's real GDP increases, the country is likely to

devote more resources to pollution reduction

which of the following is included in the economists definition of investment

the purchase of new machines, factories, or houses

real GDP is

the value of goods and services evaluated at base year prices

macroeconomics focuses on which of the following topics

unemployment, inflation, growth, and trade