FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 7: Measuring Domestic Output and National Income

Show Answer

Share

---

All types

Filters

Study Flashcards

Question 31

Multiple Choice

Review LaterAdd Note

Review Later

Gross output (GO) for an economy in a given year

A) will always be less than GDP for that economy in the same year.
B) will always equal GDP for that economy in the same year.
C) may be greater than or less than GDP for that economy in the same year.
D) will always exceed GDP for that economy in the same year.

E) None of the above
F) A) and D)

Correct Answer

verified

Show Answer

Question 32

Multiple Choice

Review LaterAdd Note

Review Later

Refer to the diagram. Which of the following statements is correct?

A) The price index is greater than 100 for every year shown on the graph.
B) Nominal GDP must be deflated in each year prior to 2000 to determine real GDP.
C) Real GDP has grown in this economy, but nominal GDP has not.
D) Nominal GDP must be deflated in each year after 2000 to determine real GDP.

E) None of the above
F) All of the above

Correct Answer

verified

Show Answer

Question 33

Multiple Choice

Review LaterAdd Note

Gross output (GO) and GDP both measure

$\begin{array} { | l | r | } \hline \text { Personal Consumption Expenditures } & \$ 400 \\\hline \text { Government Purchases } & 128 \\\hline \text { Gross Private Domestic Investment } & 88 \\\hline \text { Net Exports } & 7 \\\hline \text { Net Foreign Factor Income } & 0 \\\hline \text { Consumption of Fixed Capital } & 43 \\\hline \text { Taxes on Production and Imports } & 50 \\\hline \text { Compensation of Employees } & 369 \\\hline \text { Rents } & 12 \\\hline \text { Interest } & 15 \\\hline \text { Proprietors' Income } & 52 \\\hline \text { Corporate Income Taxes } & 36 \\\hline \text { Dividends } & 24 \\\hline \text { Undistributed Corporate Profits } & 22 \\\hline \text { Statistical Discrepancy } & 0 \\\hline\end{array}$ Refer to the accompanying national income data for the economy. All ?gures are in billions of dollars. Disposable income

The total volume of business sales in our economy is several times larger than GDP because

In the treatment of U.S. exports and imports, national income accountants

$\begin{array} { | l | c | } \hline \text { Proprietors' Income } & \$ 20 \\\hline \text { Compensation of Employees } & 300 \\\hline \text { Consumption of Fixed Capital } & 15 \\\hline \text { Gross Investment } & 80 \\\hline \text { Rents } & 10 \\\hline \text { Interest } & 20 \\\hline \text { Exports } & 30 \\\hline \text { Imports } & 50 \\\hline \text { Corporate Profits } & 25 \\\hline \text { Taxes on Production and Imports } & 5 \\\hline \text { Net Foreign Factor Income } & 0 \\\hline \text { Statistical Discrepancy } & 0 \\\hline\end{array}$ Refer to the accompanying data. All ?gures are in billions of dollars. Net domestic product is

An example of intermediate goods would be

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

A large underground economy results in an

Which would be considered an investment according to economists?

$\begin{array} { | l | c | } \hline \text { Personal Taxes } & \$ 40 \\\hline \text { Social Security Contributions } & 15 \\\hline \text { Taxes on Production and Imports } & 20 \\\hline \text { Corporate Income Taxes } & 40 \\\hline \text { Transfer Payments } & 22 \\\hline \text { U.S. Exports } & 24 \\\hline \text { Undistributed Corporate Profits } & 35 \\\hline \text { Government Purchases } & 90 \\\hline \text { Gross Private Domestic Investment } & 75 \\\hline \text { U.S. Imports } & 22 \\\hline \text { Personal Consumption Expenditures } & 250 \\\hline \text { Consumption of Fixed Capital (depreciation) } & 25 \\\hline \text { Net Foreign Factor Income } & 10 \\\hline \text { Statistical Discrepancy } & 0 \\\hline\end{array}$ Refer to the accompanying data (all ?gures in billions of dollars) . NDP is

If personal income exceeds national income in a particular year, we can conclude that

Transfer payments are included in

Depreciation is all the following, except

When local police and fire departments buy new cars for their operations, these are counted as part of

U.S. GDP in 2018 was about

National income accountants define investment to include

$\begin{array}{|c|l|r|}\hline 1 & \text { Consumption of Fixed Capital } & \$ 438 \\\hline 2 & \text { Taxes on Production and Imports } & 326 \\\hline 3 & \text { Compensation of Employees } & 2,347 \\\hline 4 & \text { Rents } & 14 \\\hline 5 & \text { Interest } & 287 \\\hline 6 & \text { Proprietors' Income } & 242 \\\hline 7 & \text { Corporate Profits } & 297 \\\hline 8 & \text { Personal Consumption Expenditures } & 2,582 \\\hline 9 & \text { Gross Private Domestic Investment } & 669 \\\hline 10 & \text { Government Purchases } & 815 \\\hline 11 & \text { Net Exports } & -78 \\\hline 12 & \text { Net Foreign Factor Income } & 46 \\\hline 13 & \text { Statistical Discrepancy } & 50 \\\hline\end{array}$ Refer to the accompanying national income data (in billions of dollars) . The expenditures approach to GDP calculation can be done by adding

If depreciation (consumption of fixed capital) exceeds gross domestic investment, we can conclude that