Econ chapter 14

Adding​ wages, interest,​ rent, and profits yields A. gross domestic product. B. GNP. C. gross domestic product at factor cost. D. total expenditure. E. net domestic product at factor cost.

E

As​ measured, GDP omits which of the​ following? i. Illegal sales of goods and services. ii. Changes in the amount of leisure time. iii. Household production of goods and services. A. i and iii B. i only C. ii and iii D. i and ii E. ​i, ii, and iii

E

In 2009 in the United​ States, consumption expenditure was​ $9,996 billion, investment was​ $1,559 billion, government expenditures on goods and services were​ $2,927 billion, and total exports were​ $1,492 billion. GDP equaled A. ​$10,120 billion. B. ​$14, 415 billion. C. ​$11,488 billion. D. ​$12,641 billion. E. some​ amount, but there is not enough information given to calculate GDP.

E

The purchase of a new Boeing fighter jet by Israel is classified in the U.S. GDP accounts as A. consumption expenditure. B. government expenditure. C. import expenditure. D. investment expenditure. E. export expenditure.

E

When an American college student in​ Davis, California spends​ $200 on a pair of Louis Vuitton jeans​ (a famous French​ brand), U.S. consumption​ ________, U.S. net exports​ ________, and U.S. GDP​ ________. A. does not​ change; does not​ change; does not change B. does not​ change; decreases by​ $200; decreases by​ $200 C. does not​ change; increases by​ $200; increases by​ $200 D. increases by​ $200; does not​ change; increases by​ $200 E. increases by​ $200; decreases by​ $200; does not change

E

In measuring​ GDP, which of the following is​ included? A. the value of durable consumption goods but not the value of nondurable consumption goods. B. the value of increases in business inventories C. the value of used goods when they are sold D. the value of preparing meals at home E. the value of stocks and bonds bought and sold

B

Which of the following is NOT directly included in Canadian​ GDP? A. The purchase of tickets to a Kanye West concert in Montreal. B. Gasoline purchased by a tour bus operator in Quebec. C. Bus tickets sold to tourists for a tour bus ride in Montreal. D. The sale of tickets to the Vancouver Oympics to U.S. citizens. E. All of the items would be included in Canadian GDP.

B

Which of the following is a final good or​ service? A. the CPUs purchased by Dell to be used in their computers B. a new replacement muffler installed by Midas Mufflers C. the computers purchased by Office Depot for sale to its customers D. the grilled chicken purchased by Taco Bell for use in their burritos E. the fertilizer purchased by Royal Lawn and Landscape

B

Which of the following would be included in​ Germany's GNP? A. the production of BMWs​ (made by a Germanminus−based ​company) in South Carolina. B. answers A and C are correct. C. the production of BMWs in Germany. D. the production of Michelin tires made in France by a French company and then sold to BMW in Germany for use in BMW cars. E. the production of Michelin tires made in Germany by a French company and then sold directly to French consumers

B

During last​ year, a country produced​ 20,000 pizzas and​ 10,000 hamburgers and nothing else. The pizzas sold for​ $10.00 each and the hamburgers for​ $3.00 each. Nominal GDP was A. ​$460,000. B. ​$360,000. C. ​$230,000. D. ​$70,000. E. ​$390,000.

C

If real GDP is greater than nominal GDP for a particular​ year, then A. production must have increased between the current year and the base year. B. prices must have fallen between the current year and the immediate past year. C. prices must have fallen between the current year and the base year. D. prices must have risen between the current year and the base year. E. production must have fallen between the current year and the base year.

C

The category of​ "rent" in the income approach to GDP A. includes only the imputed rent for ownerminus−occupied housing. B. does not have any connection to ownerminus−occupied housing. C. includes the money paid to use land and other rented inputs. D. includes the money paid to rent machinery only. E. includes the money paid to rent apartments only

C

When measuring GDP by the income​ approach, wage income includes ​ i) healthminus−care insurance paid for by the firm for its employees ​ ii) Social Security contributions made by the firm ​ iii) wages paid during a​ worker's vacation time A. ii and iii only. B. i and ii only. C. ​i, ii and iii. D. ii only. E. i only.

C

Which of the following is included in​ Germany's GDP? i. BMWs produced in a German owned factory in South Carolina ii. the value of the stocks sold on the German stock​ exchange, the Frankfurt Stock Exchange iii. china produced by the English owned Wedgewood Company at a factory in​ Berlin, Germany A. i and iii B. i and ii C. iii only Your answer is correct. D. ii only E. None of the above answers are correct.

C

Goods and services such as environmental​ quality, leisure​ time, and household production are not included in GDP because they are not A. productive activities. B. for consumption. C. really durable goods. D. bought in markets. E. made for profit.

D

To calculate GDP it is necessary to A. average the cost of producing a good with the price of the good to place a dollar value on all goods produced. B. add the total amounts of all the goods produced. C. use the average market price over the last five years to place a dollar value on all goods produced. D. use the market price to place a dollar value on each good produced. E. use production cost to place a dollar value on all goods produced.

D

To measure GDP by using the income​ approach, we must add all incomes and then​ ________ depreciation and​ ________ net taxes less subsidies. A. ​add; neither add nor subtract B. ​subtract; add C. neither add nor​ subtract; add D. ​add; add E. ​add; subtract

D

Which of the following is classified as a final good or​ service? i. tires bought by GM to put on new Tahoes ii. mustard bought by Subway to put on its sub sandwiches iii. your purchase of online access to the Wall Street Journal A. ii only. B. ​i, ii and iii. C. i and ii. D. iii only. E. ii and iii.

D

Which of the following is included as investment in​ GDP? i. cars produced during the year but unsold at the end of the year ii. new capital equipment produced and purchased during the year iii. purchases of a​ company's stocks and bonds A. i only B. ​i, ii, and iii C. ii only D. i and ii E. iii only

D