Question 1

The term "final goods and services" refers to:

Accepted Answer

A)  goods and services which are unsold and therefore added to inventories.
B)  goods and services whose value has been adjusted for changes in the price level.
C)  goods and services purchased by ultimate users, as opposed to resale or further processing.
D)  the excess of Canadians exports over Canadians imports.E) B) and C)
F) A) and B)

Question 2

Money spent on the purchase of a new house is included in the GDP as a part of:

Accepted Answer

A)  the consumption of private fixed capital.
B)  personal consumption expenditures.
C)  personal saving.
D)  investment.E) A) and B)
F) All of the above

Question 3

GDP tends to overstate economic well-being because it takes into account:

Accepted Answer

A)  all of the illegal activities conducted by organized crime in the economy.
B)  spending on intermediate goods that are used to produce final goods.
C)  health care costs related to the consumption of products with adverse health effects.
D)  the personal labour time that car owners spend working on car repairs and maintenance of their vehicles.E) B) and C)
F) A) and D)

Question 4

Real GDP and nominal GDP differ because the real GDP:

Accepted Answer

A)  is adjusted for changes in the volume of intermediate transactions.
B)  includes the economic effects of international trade.
C)  has been adjusted for changes in the price level.
D)  excludes depreciation charges.E) A) and B)
F) A) and C)

Question 5

If nominal GDP is 150 and the GDP price index is 200, real GDP is 75.

Accepted Answer

A) True 
 B)False

Question 6

If real GDP falls from one period to another, we can conclude that:

Accepted Answer

A)  deflation occurred.
B)  inflation occurred.
C)  nominal GDP fell.
D)  less goods and services have been produced.E) A) and B)
F) None of the above

Question 7

In an economy experiencing persistent deflation:

Accepted Answer

A)  potential GDP will necessarily exceed actual GDP.
B)  changes in nominal GDP may either overstate or understate changes in real GDP.
C)  changes in nominal GDP understate changes in real GDP.
D)  changes in nominal GDP overstate changes in real GDP.E) B) and C)
F) All of the above

Question 8

All figures are in billions of dollars.  Refer to the above information.The gross domestic product is:

Accepted Answer

A)  $328
B)  $402
C)  $382
D)  $336E) All of the above
F) A) and B)

Question 9

Assume an economy which is producing only one product.Output and price data for a three-year period are as follows.  Refer to the above data.If year 2 is chosen as the base year, in years 1 and 3 the price index values, respectively, are:

Accepted Answer

A)  4 and 6.
B)  6 and 4.
C)  120 and 100.
D)  100 and 150.E) A) and D)
F) A) and C)

Question 10

Suppose Smith pays $100 to Jones.

Accepted Answer

A)  We can say with certainty that the GDP has increased by $100.
B)  We can say with certainty that the GDP has increased, but we cannot determine the amount.
C)  We can say with certainty that the nominal GDP has increased, but we can't say whether real GDP has increased or decreased.
D)  We need more information to determine whether GDP has changed.E) None of the above
F) B) and C)

Question 11

Which of the following transactions is included in GDP?

Accepted Answer

A)  The production of text books
B)  Public transfer payments
C)  Private transfer payments
D)  Transactions in the stock marketE) A) and D)
F) A) and C)

Exam 7: B: Measuring the Economys Output

In an economy experiencing persistent deflation:

Correct Answer
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If real GDP falls from one period to another, we can conclude that:

Correct Answer
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Real GDP and nominal GDP differ because the real GDP:

Correct Answer
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All figures are in billions of dollars. Refer to the above information.The gross domestic product is:

Correct Answer
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If nominal GDP is 150 and the GDP price index is 200, real GDP is 75.

Correct Answer
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Which of the following transactions is included in GDP?

Correct Answer
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Money spent on the purchase of a new house is included in the GDP as a part of:

Correct Answer
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Assume an economy which is producing only one product.Output and price data for a three-year period are as follows. Refer to the above data.If year 2 is chosen as the base year, in years 1 and 3 the price index values, respectively, are:

Correct Answer
verified

GDP tends to overstate economic well-being because it takes into account:

Correct Answer
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The term "final goods and services" refers to:

Correct Answer
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Suppose Smith pays $100 to Jones.

Correct Answer
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Exam 7: B: Measuring the Economys Output

In an economy experiencing persistent deflation:

Correct AnswerverifiedShow Answer

If real GDP falls from one period to another, we can conclude that:

Correct AnswerverifiedShow Answer

Real GDP and nominal GDP differ because the real GDP:

Correct AnswerverifiedShow Answer

All figures are in billions of dollars. Refer to the above information.The gross domestic product is:

Correct AnswerverifiedShow Answer

If nominal GDP is 150 and the GDP price index is 200, real GDP is 75.

Correct AnswerverifiedShow Answer

Which of the following transactions is included in GDP?

Correct AnswerverifiedShow Answer

Money spent on the purchase of a new house is included in the GDP as a part of:

Correct AnswerverifiedShow Answer

Assume an economy which is producing only one product.Output and price data for a three-year period are as follows. Refer to the above data.If year 2 is chosen as the base year, in years 1 and 3 the price index values, respectively, are:

Correct AnswerverifiedShow Answer

GDP tends to overstate economic well-being because it takes into account:

Correct AnswerverifiedShow Answer

The term "final goods and services" refers to:

Correct AnswerverifiedShow Answer

Suppose Smith pays $100 to Jones.

Correct AnswerverifiedShow Answer

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