Econ: Ch. 5
Economics practice quiz. Chapter 5.
- 1.
The factors behind the rise in living standards in modern economies are issues more closely associated with the study of:
- A.
Long-run economic growth
- B.
Fluctuations in economic performance
- C.
The determinants of aggregate demand
- D.
All of the above
Correct Answer
A. Long-run economic growth -
- 2.
The total market value of all the final goods and services produced within an economy in a given year is called:
- A.
Gross National Product
- B.
National income
- C.
Gross Domestic Product
- D.
Net National Product
Correct Answer
C. Gross Domestic Product -
- 3.
Which of the following would be counted in this year’s GDP?
- A.
The sale of a brand new house
- B.
The sale of an old house
- C.
Both sales would be included
- D.
Neither brand new houses nor existing houses would be included
Correct Answer
A. The sale of a brand new house -
- 4.
The sustained increases in the real production of an economy over time is what economists define as:
- A.
Inflation
- B.
Economic growth
- C.
An expansion
- D.
An economic boom
Correct Answer
B. Economic growth -
- 5.
Which of the following is included in the economist’s definition of investment?
- A.
The purchase of a new machine, factory, or house
- B.
The purchase of a new share of stock
- C.
The purchase of a rare coin or deposit in a savings account
- D.
All of the above
Correct Answer
A. The purchase of a new machine, factory, or house -
- 6.
Which of the following is included in private investment expenditures?
- A.
Spending on new plants and equipment
- B.
Newly produced housing
- C.
Additions to inventories during the current year
- D.
All of the above
Correct Answer
D. All of the above -
- 7.
Which of the following equalities is correct?
- A.
Gross investment – net investment = inventories
- B.
Gross investment – depreciation = net investment
- C.
Gross investment + depreciation = net investment
- D.
Gross investment + inventories – depreciation = net investment
Correct Answer
B. Gross investment – depreciation = net investment -
- 8.
In GDP accounting, which levels of government spending are included in government purchases?
- A.
Only spending by the federal government on goods and services
- B.
Spending by federal, state, and local governments on goods and services
- C.
Spending by the federal government and some state governments on goods and services, but not local governments
- D.
Spending by governments only as they relate to national security, social welfare, and other national programs
Correct Answer
B. Spending by federal, state, and local governments on goods and services -
- 9.
Which of the following equalities is correct?
- A.
Exports – imports = net exports
- B.
Net imports – exports = imports
- C.
Imports – exports = net exports
- D.
Net exports = exports + imports
Correct Answer
A. Exports – imports = net exports -
- 10.
In which of the following time periods did the United States run a trade surplus as a share of GDP?
- A.
Never. The U.S. has always had trade deficits
- B.
From 1960 to 2005
- C.
In the early 1980s
- D.
Always. The United States has always run a trade surplus with other nations
Correct Answer
C. In the early 1980s -
- 11.
The total of personal income that households keep after paying income taxes is called:
- A.
Gross domestic product
- B.
Gross National product
- C.
Personal income
- D.
Personal disposable income
Correct Answer
D. Personal disposable income -
- 12.
If prices rose by 15% between the base year and another year, the value of the GDP deflator for the latter year would be:
- A.
15%
- B.
15
- C.
115
- D.
1,500
Correct Answer
C. 115 -
- 13.
Which of the following is true about the measurement of GDP?
- A.
GDP is capable of measuring transactions that do not take place in organized markets
- B.
GDP is a good indicator of the value of leisure time in the economy
- C.
GDP ignores the underground economy
- D.
GDP is an accurate measure of the environmental impact of production
Correct Answer
C. GDP ignores the underground economy -
- 14.
The period of severe economic contraction and high unemployment known as the Great Depression took place in this decade:
- A.
The 1920s
- B.
The 1930s
- C.
The 1940s
- D.
The 1970s
Correct Answer
B. The 1930s -
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Jan 10, 2013Quiz Edited by
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Mar 22, 2010Quiz Created by
Mruegg91
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