Chapter 7 A

federal, state, and local government expenditures.

Government purchases include

monetary value of all final goods and services produced within the borders of a nation in a particular year.

GDP is the

in dollar amounts

Gross domestic product (GDP) measures and reports output

interest

The money paid by private businesses to the suppliers of loans used to purchase capital is called

exports less imports

net exports are

consumer durable goods and therefore personal consumption expenditures.

Buying new furniture for your home would increase

gross rental income minus depreciation of the rental property.

The income amount used for "Rents" in the national accounts is net rent, so it is

only counting final goods.

National income accountants can avoid multiple counting by

True

National income accountants consider services to be an intangible act or use for which a consumer, firm, or government is willing to pay.

true

Purchasing a two-year-old, secondhand laptop contributes nothing to this year's GDP.

$110

Refer to the accompanying data (all figures in billions of dollars). The gross domestic product for this economy is

$500

A business buys $1,000 worth of inputs from other firms in order to produce a product. The business makes 500 units of the product and each of them sells for $3. The value added by the business to these products is

is the dollar value of all final output produced within the borders of the nation during a specific period of time.

A nation's gross domestic product (GDP)

private transfer payment.

A transfers of funds from one private individual to another private individual without any production taking place is a(n

obtain a sum substantially larger than GDP.

By summing the dollar value of all monetary transactions in the economy, we would

are included in Ig.

Expenditures on the research and development (R&D) of new productive technologies

goods and services purchased by ultimate users, rather than for resale or further processing.

Final goods and services refers to

spending on new writing that increases the flow of entertainment and education.

Human-made resources that are referred to as "recipes" includes

the GDP would be overstated

If intermediate goods and services were included in GDP,

All of the answers are correct.

Interest consists of the money households receive on

We need more information to determine whether GDP has changed.

Suppose Smith pays $100 to Jones.

GDP that year is $500 billion.

Suppose the total monetary value of all final goods and services produced in a particular country in a year is $500 billion and the total monetary value of final goods and services sold is $450 billion. We can conclude that

NAtional Income and Product Accounts

The Bureau of Economic Analysis compiles the NIPA accounts. The letters NIPA represent

Bureau of Economic Analysis.

The agency responsible for compiling the National Income and Product Accounts for the U.S. economy is the

rents include the interest paid to the suppliers of loans used to purchase capital.

The income approach to national income accounting lists "Rents" as one of the components. All of the following statements about "rents" are correct except

adds the monetary values of each final good or service produced.

To manage the problem of adding dissimilar items when calculating GDP, the BEA

such payments generate no production.

Transfer payments are not included in government purchases because

a public transfer payment

Veterans' payments are excluded from GDP calculations because they are

the value of a checkup with your doctor

Which of the following will NOT be included in U.S. GDP?