Econ last exam quiz 3
inflation equation
(new-old)/old X 10
nominal GDP equation
(price X quantity) + (Pirce X quantity)
CPI equation
(price of the basket in current year)/(price of basket in base year) X 100
A United States-based company in New York City opens a plant in Viet Nam that produces all of their good.
not included
A businessman in Los Angeles decides to invest more assets into technological stocks.
not included
A local gamer buys a new steady state hard drive from Japan.
not included
A local lawyer that usually makes $110/hour takes a pro bono case to help a struggling family in New Jersey.
not included
Samsung, a Korean company, produces their phones in Korea and ships them to the United States to be sold.
not included
real GDP fixes what
quantity of the base year
Which of the following is a better indicator of economic well-being?
real GDP
The consumer price index (CPI) measures approximately the same economic phenomenon as
te GDP deflator
A family pays a contractor $100,000 for a house he built for them this year.
Investment spending
Which of the following actions by the Fed would reduce the money supply
An increase in the interest rate paid on reserves
which of the following does NOT add to U.S. GDP? 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 policeman. d. The federal government sends a Social Security check to your grandmother.
D. The federal government sends a Social Security check to your grandmother.
An accountant pays a tailor $175 to sew a suit for her.
consumption spending
You spend $7.00 to attend a movie.
consumption spending
You pay $300 a month to rent an apartment.
consumption spending or investment spending
GDP is the market value of all final intermediate goods produced within the United States during a given time period true or false
false
The government increases its defense expenditures by $1,000,000,000.
government spending
GDP is an imperfect measure of a country's well-being because it does not capture
how much leisure time a country takes
20,000 textbooks are sold to schools in Germany by a U.S. textbook company.
included
A local consulting firm decides to invest in the construction of a new office space.
included
A stay at home mom in Montana starts babysitting for the local community and gets paid.
included
The U.S. Congress signs a bill funding the creation of 1,000 new federal job positions.
included
At the end of the year, a flour-milling firm finds that its inventories of grain and flour are $10,000 above the amounts of its inventories at the beginning of the year.
investment spending
Ford Motors Co. buys new auto-making robots.
investment spending
purchasing power risen how do you find it
just minus the two percents
The money supply includes all of the following EXCEPT
metal coins
indexation equation
money in old year X (new year CPI)/ CPI in old year
Arkansans sell $1,000,000 worth of rice to China.
next exports
GDP deflator equation
nominal/ral X 100
You buy General Motors Corp. stock for $1,000 in the stock market.
not coined in GDP
A family pays $75,000 for a house he built three years ago.
not counted in GDP
Hyundai sells $5,000,000 worth of sedans in Seoul, South Korea.
not counted in GDP
The government makes a $300 Social Security payment to a retired person.
not counted in GDP
A homemaker works hard caring for her spouse and two children.
not counted in GdP
A U.S. shoe company produces shoes in China that are then sold in the United States
not included