Fall_06_Copy_of_Practice_Questions_for_Midterm2

Fall_06_Copy_of_Practice_Questions_for_Midterm2 - 49...

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49 Suppose a professional gambler moves in year 2004 from Utah, where he gambles illegally, to Nevada, where gambling is legal. If he reports truthfully his income, then as a result of his move: a. there is no effect on GDP because his income is included in both 2003 GDP and 2004 GDP b. there is no effect on GDP because his income is excluded in both 2003 and 2004 GDP c. GDP will be higher in 2004 d. GDP will be lower in 2004 e. none of the above 50 Which of the following is an example of double counting? a. errors made in adding together the value of all final goods and services to measure GDP b. adding the market value of the wood used to produce a house to the market value of the house in measuring GDP c adding the change in inventories to GDP d. all of the above are examples of double counting e none of the above are examples of double counting 51 GDP includes the value of final goods and not intermediate goods because a. the value of intermediate goods is already included in the value of final goods b. the value of intermediate goods is too difficult to measure c. the value of intermediate goods is measured by GNP d. the value of intermediate goods depends on the number of separate production processes e. none of the above 52 Goods that go into inventory and are not sold during the current period: a are included in GDP as an inventory investment during the current period b. are intermediate goods until sold, hence are not included in GDP in the current period c. are included in GDP as consumption d. are included in GDP as an inventory investment, but not until the goods are sold e. none of the above 53 The local Chevrolet dealership has an increase in inventory of 22 cars in 2000. In 2001, it sells all 22 cars. Based on this information, which of the following is correct: a. the value of the increased inventory will be counted as part of GDP in 2000, but the value of the 22 cars sold in 2001 will not cause 2001 GDP to increase b. the value of the increased inventory will not affect 2000 GDP, but the sale of the cars in 2001 will cause 2001 GDP to increase c the value of the increased inventory will be counted as part of GDP in 2000, and the value of 22 cars sold in 2001 will cause 2001 GDP to increase d. since the cars were not sold in 2000, they will not be included as part of 2000 GDP, and since they were not produced in 2001, they will not be included as part of the 2001 GDP e. none of the above 54 A South African citizen owns an ostrich ranch in the United States. The revenues from the ostrich ranch: a. are part of both South African GNP and US GNP b. are part of South African GNP and are part of US GDP c. are part of South African GDP, but not part of South African GNP d. are part of US GNP, but not part of South African GNP e. are part of US GNP and part of South African GDP 55 When the government reports that GDP "increased at an annual rate of 6.8 percent for the fourth quarter of 1999," it means that: a. GDP actually increased by 6.8 percent during the 4th quarter of 1999
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This note was uploaded on 05/23/2010 for the course ECON 102 taught by Professor Payan during the Fall '09 term at Glendale Community College.

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Fall_06_Copy_of_Practice_Questions_for_Midterm2 - 49...

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