Chapter 23 & 25

Which is the largest component of GDP? Select one: a. consumption b. investment c. government purchases d. net exports

a. consumption

Thomas Malthus believe that population growth would Select one: a. put stress on the economy's ability to produce food, dooming humans to remain in poverty. b. spread the capital stock too thinly across the labor force, lowering each worker's productivity. c. promote technological progress, because there would be more scientists and inventors. d. eventually decline to sustainable levels, as birth control improved and people had smaller families.

a. put stress on the economy's ability to produce food, dooming humans to remain in poverty.

Over the past century, real GDP per person in the United States has grown about _____% per year, which means that it doubles about every _____ years. Select one: a. 2, 14 b. 2, 35 c. 5, 14 d. 5, 35

b. 2, 35

If all quantities produced rise by 10% and all prices fall by 10%, which of the following occurs? Select one: a. Real GDP rises by 10%, while nominal GDP falls by 10%. b. Real GDP rises by 10%, while nominal GDP is unchanged. c. Real GDP is unchanged, while nominal GDP rises by 10%. d. Real GDP is unchanged, while nominal GDP falls by 10%.

b. Real GDP rises by 10%, while nominal GDP is unchanged.

The world's rich countries, such as the United States and Germany, have income per person that is about _____ times the income per person in the world's poor countries, such as Pakistan and India. Select one: a. 2 b. 4 c. 10 d. 30

c. 10

An American buys a pair of shoes made in Italy. How do the U.S. national income accounts treat the transaction? Select one: a. Net exports and GDP both rise. b. Net exports and GDP both fall. c. Net exports fall, while GDP is unchanged. d. Net exports are unchanged, while GDP rises.

c. Net exports fall, while GDP is unchanged.

Which of the following does not add to U.S. GDP? Select one: a. Air France buys a plane from Boeing, the U.S. aircraft manufacturer. b. General Motors builds a new auto factory in North Carolina. c. The city of New York pays a salary to a police officer, in return for the services the officer provides. d. The federal government sends a Social Security check to your grandmother (who is not producing any services in exchange).

d. The federal government sends a Social Security check to your grandmother (who is not producing any services in exchange).

Most economists are _____ that natural resources will eventually limit growth. As evidence, they note that the prices of most natural resources, adjusted for overall inflation, have tended to _____ over time. Select one: a. concerned, rise b. concerned, fall c. not concerned, rise d. not concerned, fall

d. not concerned, fall