economics final exam chapter 5

real GDP is

GDP adjusted for changes in the price level

if Gordon's Gadgets, Inc. produced and sold 50,000 gadgets in Year 1 at an average price (including sales tax) of $12 per gadget, how much did Gordon's production add to GDP in Year 1

$600,000

which of the following would directly affect GDP about aunt marcella

Aunt Marcella buys groceries

comparisons of GDP between developed countries and less developed countries will tend to overstate the difference in standard of living because

GDP does not include nonmarket production

the state with the lowest per capita income in 2013 was

Mississippi

which of the following would directly affect GDP

a furniture manufacturer buys new equipment

Real GDP is GDP

adjusted for changes in the price level

transfer payments

are transfers of income from the govt to households or businesses, not in exchange for goods, services, or resources

which of the following statements is true about consumption

consumption is the largest component of GDP

gross _____ _____ is the market value of all final goods and services produced annually

domestic product

the largest component of national income is

employee compensation

the phase of the business cycle when Real GDP is increasing is

expansion

between 1974 and 2013 Real GDP did what

increased by almost 3-fold

gross domestic product

is the basic measure of total output

the highest phase of the business cycle is

peak

in comparing total output from different years

real GDP gives a fair comparison

absolute economic growth

refers to an increases in Real GDP

investment is

the acquisition of new physical capital

imports is

total domestic purchases of foreign goods

exports is

total foreign purchases of domestic goods