Macroeconomics- Chapter 7 ESU Dr. Behr

Net exports are:

exports less imports

GDP can be calculated by summing:

Consumption, Investment, Government purchases, and net exports

Net exports are negative when:

a nation's exports exceeds its imports

Real GDP refers to:

GDP data that have been adjusted for changes in the price level.

Which of the following activities is excluded from GDP, causing GDP to understate a nation's production?

Goods & serviced produced in the underground economy.

Net Domestic Product (NDP)

Gross domestic product less the part of the year's output that is needed to replace the capital goods worn out in producing the output the nation's total output available for consumption or additions to the capital stock.

Which of the following activities is excluded from GDP, causing GDP to understate a nation's well-being?

The child-care services provided by stay-at-home parents

A price index is:

a comparison of the current price of a market basket to a fixed point of reference.

The value added of a firm is the market value of:

a firm's output less the value of the inputs bought from others.

Which of the following is a final good or service? a. A haircut purchased by a father for his 12 year-old son. b. Fertilizer purchased by a farm supplier. c. Diesel fuel bought for a delivery truck. d. Chevrolet windows purchased by a General Motors assembly plant.

a. A haircut purchased by a father for his 12 year old son

Which of the following is an intermediate good? a. The purchase of gasoline for a ski trip to Colorado. b. The purchase of baseball uniforms by a professional baseball team. c. The purchase of a pizza by a college student. d. The purchase of jogging shoes by a professor.

b. The purchase of baseball uniforms by a professional baseball team.

The largest component of total expenditures in the United States is:

consumption

Which of the following transactions would be included in GDP? a. Mary buys a used book for $5 at a garage sale. b.Nick buys $5,000 worth of stock in Microsoft. c. Olivia receives a tax refund of $500. d. Peter buys a newly constructed house.

d. Peter buys a newly constructed house.

A nation's gross domestic product (GDP):

is the dollar value of all final output produced within the borders of the nation during a specific period of time. can be found by summing C + Ig + G + Xn.

The smallest component of aggregate spending in the United States is:

net exports

In calculating GDP, governmental transfer payments, such as Social Security or unemployment compensation, are:

not counted

National income accountants can avoid multiple counting by:

only counting final goods

Tom Atoe grows fruits and vegetables for home consumption. This activity is:

productive but is excluded from GDP because no market transaction occurs.

If intermediate goods and services were included in GDP:

the GDP would be overstated

The concept of net domestic investment refers to:

total investment less the amount of investment goods used up in producing the year's output.