Econ 101 - Principles of Macroeconomics » Fall 2021 » Chapter Quiz Chapter 10

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Question #1
An example of a transfer payment is
A.   wages.
B.   unemployment benefits.
C.   government purchases.
D.   rent.
E.   profit.
Question #2
The value of plant and equipment worn out in the process of manufacturing goods and services is measured by
A.   investment.
B.   depreciation.
C.   intermediate production.
D.   consumption.
E.   Net national product.
Question #3
Which of the following would be excluded from 2019 GDP? The sale of
A.   a haircut.
B.   a home built in 2018 and first sold in 2019.
C.   a realtor's services.
D.   a 2019 Honda made in Tennessee and a realtor's services
E.   a 2019 Honda made in Tennessee.
Question #4
Gross domestic product can be measured as the sum of
A.   investment, wages, profits, and intermediate production.
B.   net national product, gross national product, and disposable personal income.
C.   consumption, transfer payments, wages, and profits.
D.   consumption, investment, government purchases, and net exports.
E.   final goods and services, intermediate goods, transfer payments, and rent.
Question #5
U.S. gross domestic product (in contrast to gross national product) measures the production and income of
A.   the domestic manufacturing sector only.
B.   Americans and their factories no matter where they are located in the world.
C.   the domestic service sector only.
D.   people and factories located within the borders of the United States.
E.   none of the above
Question #6
Gross domestic product is the sum of the market value of the
A.   manufactured goods.
B.   inferior goods and services.
C.   normal goods and services.
D.   final goods and services.
E.   intermediate goods.
Question #7
If nominal GDP in 2019 exceeds nominal GDP in 2018, then the production of output must have
A.   stayed the same.
B.   risen.
C.   fallen.
D.   risen or fallen because there is not enough information to determine what happened to real output.
Question #8
If a cobbler buys leather for $100 and thread for $50 and uses them to produce and sell $500 worth of shoes to consumers, the contribution to GDP is
A.   $650
B.   $50
C.   $600
D.   $500
E.   $100
Question #9
GDP would include which of the following?
A.   consulting services
B.   the value of taking a day off from work
C.   illegal drug sales
D.   housework
E.   intermediate sales
Question #10
Real GDP is measured in ______ prices while nominal GDP is measured in ______ prices.
A.   base year; current year
B.   current year; base year
C.   domestic; foreign
D.   foreign; domestic
E.   intermediate; final
Question #11
If U.S. GDP exceeds U.S. GNP, then
A.   Americans are producing more in foreign countries than foreigners are producing in the United States.
B.   real GNP exceeds nominal GNP.
C.   intermediate production exceeds final production.
D.   real GDP exceeds nominal GDP
E.   foreigners are producing more in the United States than Americans are producing in foreign countries.
Question #12
U.S. GDP would exclude which of the following?
A.   the purchase of a new Mazda produced in Illinois
B.   a new bridge purchased by the state of Texas
C.   lawn care services purchased by a homeowner
D.   lawyer services purchased by a home buyer
E.   cotton purchased by Lee Jeans
Question #13
How is your purchase of a $40,000 BMW automobile that was produced entirely in Germany recorded in the U.S. GDP accounts?
A.   There is no impact because this transaction does not involve domestic production.
B.   Consumption increases by $40,000 and net exports decrease by $40,000.
C.   Net exports decrease by $40,000.
D.   Net exports increase by $40,000.
E.   Investment increases by $40,000 and net exports increase by $40,000.
Question #14
If your grandparents buy a new retirement home, this transaction would affect
A.   investment.
B.   consumption.
C.   net exports.
D.   government purchases.
E.   none of the above

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