MACRO CHAPTER 19

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The value of each automobile in gross domestic product equals (table)

$25,000

CANOES-R-US makes canoes. It buys the shell of the canoe from another firm for $300 and uses its labor and intermediate goods to make the canoe. It sells the finished canoe to a retail canoe store for $800. The retail canoe store then sells the canoe to a consumer for $1,200. The value added of CANOES-R-US for each canoe equals

$500

Which one of you owes Greta Lee Knower a snack tomorrow morning for busting her ahhhhh on these quizlets????????

Any of u hoes reading this :)

Macro economics, as opposed to micro economics, includes the study of what determines the

Average price levels of goods and services in the economy

To make the calculation of real GDP more accurate, in 1996 the BEA switched to using

Chain-weighted prices

When the BEA calculates real GDP using the average of prices in the current year and the year preceding it, and this average changes from year to year, this is called calculating GDP using

Chained-weighted prices

To calculate GDP buy the expenditure method, one must add

Consumption spending, investment spending, government purchases, and exports

Macro economics seeks to understand

Economic growth, business cycles, and inflation.

Macro economics, as opposed to microeconomics, includes the study of what determines the level of

Employment in the economy

In the circular flow model the value of total income for an economy ________ the value of total production.

Equals

The some of the value added of every firm involved in producing all final goods and services _______ gross domestic product.

Equals

Which of the following equations correctly measures GDP in an economy?

GDP = C + I + G + NX

GDP is not a perfect measure of well-being because

GDP is not adjusted for pollution

National income is equal to

GDP minus depreciation

National income is defined as

Gross domestic product less the consumption of fixed capital

The GDP deflator is equal to

Nominal GDP divided by real GDP multiplied by 100

If real GDP in 2018 (using 2009 prices) is lower than nominal GDP of 2017 then

Prices in 2018 are lower than prices in 2017

Which of the following headlines would be more closely related to what microeconomists study?

Real GDP grows buy 2.3% in the second quarter

The "underground economy" is also referred to as

The informal sector

Value added equals the market price of the firm's product minus

The price of intermediate goods

To calculate GDP using the value-added method, one would add up

The value added by each firm involved in the production of final goods and services

U.S. gross national product is defined as

The value of final goods and services produced by the residents the United States even if the production takes place outside of the United States

Depreciation is

The value of worn-out equipment,machinery and buildings

An example of a final good would be

a soy latte sold by Starbucks to a student.

The GDP deflator is a measure of the

average level of prices of final goods and services in the economy.

Which of the following is not a durable good?

clothing

The purchase of a new automobile is included in

consumption expenditures on durable goods

National income equals gross national product minus

depreciation

The best measure of the income households actually have available to spend is

disposable personal income

The informal sector can be a significant drag on the economies of developing countries because the firms in the informal sector

do not pay taxes to the government.

In the circular flow model of the value of total production for an economy _______ the value of total expenditures on final goods and services.

equals

During a business cycle expansion, total production ________ and total employment ________.

increases, increases

Which of the following is not directly counted in GDP?

intermediate goods

A final good is one that

is purchased by its final user

Disposable personal income equals personal income

minus personal tax payments

National income equals gross domestic product

minus the consumption of fixed capital

Personal income is defined as

national income less retained earnings plus transfer payments and plus interest on government bonds.

Disposable personal income is defined as

personal income less personal taxes

Gross National Product (GNP) of the United States is the market value of all final goods and services

produced by citizens of the United States anywhere in the world.

Gross domestic product understates the total production of final goods and services because of the omission of

underground economy

Nominal GDP is GDP in a given year

valued in the prices of that year


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