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
