chapter 4 econ

in the above figure, flow B represents households' ________

consumption expenditures

The factor market can best be described as where

firms buy the services of labor, land and capital

the factor market can best be described as where

firms buy the services of labor, land and capital

which of the following is a final good?

flour purchased at the store to bake cookies

The business cycle refers to

fluctuations in the level of real GDP around potential GDP

Net investment equals

gross investment - depreciation

If imports are $100 million less than exports, government expenditures are $500 million, consumer expenditures are $1 billion, and gross investment spending is $500 million, then GDP is

$2.1 billion

(in millions of euros, in constant prices): 2006 2007 Consumption 84,000 89,000 Government expenditure 24,000 26,000 Investment 48,000 48,000 Exports 142,000 151,000 Imports 123,000 128,000 Subsidies 1,800 1,900 Taxes 500 500 Ireland's real GDP in 2007 was ________ million euros

186,000

in the circular flow diagram, aggregate expenditure includes the sum of

consumption and investment

GDP equals

C + I + G + (X - M)

Which of the following relationships is CORRECT?

Gross Investment = Net Investment + Depreciation

Nominal GDP is

GDP valued at prices of that year

Which of the following is NOT a reason that real GDP is a poor measure of a nation's economic welfare?

Real GDP overvalues household production

Suppose the country of Dingo experienced an economic trough in January 2011. We can conclude that

an expansion occurred after January 2011

Purchasing power parity prices are used to construct GDP data that

can be used to make more valid comparisons between one country and another

The income approach to measuring GDP sums together

compensation of employees, rental income, corporate profits, net interest, proprietors' income, indirect taxes paid, and depreciation and subtracts subsidies paid by the government

Gross domestic product is a measure of the total value of all

final goods and services produced in an economy over a period of time

In the above figure, flow B represents ________

household purchases of goods and services

the circular flow diagram indicates that

households sell the services of factors of production to firms

It is estimated that in 2007, Mexico had a population of 110 million and GDP of $1 trillion. In 2006, Mexico's population was 104 million and GDP was $839 billion. Per GDP person ________ by ________ between 2006 and 2007 in Mexico.

increased; $1038

In the national income accounts, the purchase of a new house counts as

investment

Which of the following is NOT one of the components for computing GDP based upon the income approach?

investment

A new 2015 Honda Civic produced in 2015 and purchased in 2016 is

part of GDP in 2015

In the expenditure approach to GDP, the largest component is

personal consumption expenditures

The low point of economic activity during a business cycle is called the

trough