Econ: Ch. 5

1. The sustained increases in the real production of an economy over time is what economists define as:

Inflation

Economic growth

An expansion

An economic boom

2. Which of the following equalities is correct?

Exports – imports = net exports

Net imports – exports = imports

Imports – exports = net exports

Net exports = exports + imports

3. Which of the following would be counted in this year’s GDP?

The sale of a brand new house

The sale of an old house

Both sales would be included

Neither brand new houses nor existing houses would be included

4. Which of the following is included in the economist’s definition of investment?

The purchase of a new machine, factory, or house

The purchase of a new share of stock

The purchase of a rare coin or deposit in a savings account

All of the above

5. In GDP accounting, which levels of government spending are included in government purchases?

Only spending by the federal government on goods and services

Spending by federal, state, and local governments on goods and services

Spending by the federal government and some state governments on goods and services, but not local governments

Spending by governments only as they relate to national security, social welfare, and other national programs

6. The total market value of all the final goods and services produced within an economy in a given year is called:

Gross National Product

National income

Gross Domestic Product

Net National Product

7. Which of the following equalities is correct?

Gross investment – net investment = inventories

Gross investment – depreciation = net investment

Gross investment + depreciation = net investment

Gross investment + inventories – depreciation = net investment

8. The period of severe economic contraction and high unemployment known as the Great Depression took place in this decade:

The 1920s

The 1930s

The 1940s

The 1970s

9. The factors behind the rise in living standards in modern economies are issues more closely associated with the study of:

Long-run economic growth

Fluctuations in economic performance

The determinants of aggregate demand

All of the above

10. Which of the following is included in private investment expenditures?

Spending on new plants and equipment

Newly produced housing

Additions to inventories during the current year

All of the above

11. In which of the following time periods did the United States run a trade surplus as a share of GDP?

Never. The U.S. has always had trade deficits

From 1960 to 2005

In the early 1980s

Always. The United States has always run a trade surplus with other nations

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:

15%

15

115

1,500

13. Which of the following is true about the measurement of GDP?

GDP is capable of measuring transactions that do not take place in organized markets

GDP is a good indicator of the value of leisure time in the economy

GDP ignores the underground economy

GDP is an accurate measure of the environmental impact of production

14. The total of personal income that households keep after paying income taxes is called:

Gross domestic product

Gross National product

Personal income

Personal disposable income

Econ: Ch. 5

1. The sustained increases in the real production of an economy over time is what economists define as:

2.

What first name or nickname would you like us to use?

2. Which of the following equalities is correct?

3. Which of the following would be counted in this year’s GDP?

4. Which of the following is included in the economist’s definition of investment?

5. In GDP accounting, which levels of government spending are included in government purchases?

6. The total market value of all the final goods and services produced within an economy in a given year is called:

7. Which of the following equalities is correct?

8. The period of severe economic contraction and high unemployment known as the Great Depression took place in this decade:

9. The factors behind the rise in living standards in modern economies are issues more closely associated with the study of:

10. Which of the following is included in private investment expenditures?

11. In which of the following time periods did the United States run a trade surplus as a share of GDP?

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:

13. Which of the following is true about the measurement of GDP?

14. The total of personal income that households keep after paying income taxes is called: