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ECON_120_chap_5_test_ans - < Your location Assessments>...

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Unformatted text preview: < Your location: Assessments > View All Submissions > View Attempt View Attempt 1 of 1 Title: Ch 5 Quiz Started: October 4, 2009 10:32 PM Submitted: October 4, 2009 10:4? PM Time spent: 00: 15:00 Total score: 2/5 = 40% Total score adjusted by 0.0 Maximum possible score: 5 Done Which of the following would be counted in this year’s GDP? Student Value Correct Answer Feedback Response A. The sale of [Z a brand new house. B. The sale of an old house. (3. Both sales 0% Incorrect. Only brand new houses would be counted when sold, not old would be houses, which have been counted in the year in which they were first included. sold. D. Neither brand new houses nor existing houses would be included. Score: 0/1 Which of the following is included in the economist’s definition of investment? Student Value Correct Answer Feedback Response A. The 100% [2 Correct. Economists reserve the word investment for purchases of new purchase of machinery, factories, and houses. Why don’t economists include a new purchases of stock or rare coins or deposits in sayings account in the machine, definition of inyestment? The reason is that these other activities don’t factory, or increase the ability of the economy to produce goods and services. house. B. The purchase of a new share of stock. (3. The purchase of a rare coin or deposit in a sayings account. D. All of the above. Score: 1/1 If prices rose by 15% between the base year and another year, the value of the GDP deflator for the latter year would be: Student Value Correct Answer Feedback Response A.15% B. 15 0% Incorrect. GDP deflator is a price index and must be expressed as such. (3. 115 [2 o. 1,soo Score: 0/1 Which of the following is true about the measurement of GDP? Score: Student Value Response . 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 100% the underground economy. . GDP is an accurate measure of the environmental impact of production. l/l Correct Answer Feedback Correct. GDP does not include transactions that occur in the informal economy. This question tests your understanding of Application 3 in this chapter: The links between self-reported happiness and GDP. Do increases in gross domestic product necessarily translate into improvements in the welfare of citizens? Could it be the increased stress of everyday life has taken its toll on our happiness despite an increase in income? Holding other factors constant, individuals with higher incomes do report higher levels of personal satisfaction. But these “other factors” are quite important. For example, unemployment and divorce lead to sharply lower levels of satisfaction. In examining the relationship between GDP per capita and happiness, two economists, David Blanchflower of Dartmouth College and Andrew Oswald of Warwick University found that: Student Response Value . There is a strong correlation 3etween the growth of GDP per capita and wappiness. . The fiappiness of African Americans was risen 'aster than whites. . Despite very arge increases in 3er capita income, reported evels of fiappiness wave actuaHy declined in he United States over he past 30 years. . The 0% relationship 3etween happiness and the growth of GDP per capita across demographic groups is difficult if not imnnssihle Correct Answer Feedback Incorrect. These economists were able to systematically analyze this relationship by conducting surveys over a nearly 30-year period that ask individuals to describe themselves as “happy, pretty happy, or not too happy.” r _ _ _ . _ . _ to measure. Score: D/l ...
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