Macroeconomics EC #1
a cruise on a ship registered in Norway
Which of the following will not be included in the GDP?
$180
a sheep ranch produces $30 worth of wool. A suit manufacturer produces $60 worth of suits. A retail outlet sells a suit to a customer for $180. The change in GDP would be:
does not change
everything else the same, if investment expenditures rise by $300 billion and imports increase by $300 billion, then GDP:
personal consumption expenditure
expenditures by individuals for durable goods, nondurable goods, and services is known as:
is an allowance for depreciation
the capital consumption allowance:
circular flow diagram
the diagram that illustrates how households and businesses interact through product and resource markets is called the:
gross; net exports
the four types of spending in GDP are personal customer spending, _____________ private domestic investment, government spending, and ______________.
corporate profits and rental income
the income approach to calculating GDP includes compensation plus:
consumption expenditure
the largest component of GDP is:
compensation of employees
the largest component of national income is:
personal consumption plus gross private investment plus government spending plus net exports
total spending in a economy is the sum of:
services
what component of GDP includes college tuition?
net exports
what components of US GDP is usually negative in boom years?
imports
what does M represent in the following formula? GDP= C+I+G+(X-M)
bacon purchased at a grocery store
what is an example of a final good?
$2.65
the sale of the loaf of bread adds _________ to GDP.
is a part of US GNP
the value of the cars that the Ford Motor Company produces in a German plant:
investment
which component of GDP includes inventory changes?
GDP= C+I+G+(X-M)
which equation summarizes the expenditures approach to measuring GDP?
households are buyers of products and sellers of production factors.
which of the following is true within the circular flow of economic activity?
purchases of common stock
which of the following items is not included in gross private domestic investment?
refrigerator
which of the following items would be considered a durable good?
a hamburger purchased by a hungry person at a restaurant patron
which one of the following would be included in the GDP calculations?
investment is a key determinant of economic growth
Economists believe that changes in investment spending are important for forecasting the business cycle because:
inside the US by foreign citizens: outside the US by the US citizens
GDP includes outputs produced ___________ but does not include outputs produced ___________.
double counting
GDP measures the final value of goods and services produced to avoid the problem of:
outside the US by US citizens; inside the US by foreign citizen
GNP includes outputs produced _________ but it does not include outputs produced ___________.
US or foreign citizens; US citizens
Gross domestic product measures the output produced by _____________ using resources in the country, while gross national product measures output produced by resources supplied by _____________.
$250
John earns $2,000. His taxes are $250 and he spends $1,500. Therefore, his savings must be:
GDP minus depreciation
Net domestic product measures:
spending; income
The simple circular flow diagram shows that economic aggregates can be calculated either by the _________ flows in the product market or by the __________ flowing to households in the resource market.
They do not capture most non market economic activity
Which of the following is a criticism of the national income and product accounts?
residential housing
Which of the following items is not a category of personal consumption expenditures?
fixed investments; swings in the business cycle
gross private domestic investment, which consists of ______________ and changes in private inventories, is an important determinant of ______________.
rises by $10 billion
holding other expenditures constant, if imports fall by $20 billion and exports fall by $10 billion, then GDP:
2013's; inventory changes
if a car is produced in Detroit in 2013 but not sold until 2014, it should be included in ____________ GDP, and its value should be counted in ___________.
$140
if personal consumption is $100, investment is $25, government purchases total $25, imports equal $20, and exports equal $10, then GDP equals:
income and expenditures
in the national income and product accounts system the two main approaches to measuring the size of the economy are:
payments to Social Security recipients
int he national income accounts, which of the following is not classified as government spending
gross private domestic investment
investment in structures, equipment, software, and net inventory is known as:
exports minus imports
net exports equal:
it is a leading indicator of the business cycle
one important reason economists track business investment is that:
one person's spending is another person's income
one of the key concepts involved in the circular flow diagram is that:
