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Mock Exam

# Mock Exam - Summer 2003 MBA 501-01 Economics Survey Tong...

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Summer 2003 MBA 501-01 Economics Survey Tong Mock Exam (no credit) Part I. Multiple Choice (One point each) Identify the letter of choice that best completes the statement or answers the question. Use the following to answer question 1: Answer the next question(s) on the basis of the following data. All figures are in billions of dollars. G r o s s i n v e s t m e n t \$ 1 8 N a t i o n a l i n c o m e 1 0 0 N e t e x p o r t s 2 P e r s o n a l i n c o m e 8 5 P e r s o n a l c o n s u m p t i o n e x p e n d i t u r e s 7 0 S a v i n g 5 G o v e r n m e n t p u r c h a s e s 2 0 N e t d o m e s t i c p r o d u c t 1 0 5 1. The gross domestic product for the above economy is: A) \$100. B) \$95. C) \$110. D) \$107. 2. The total amount of income earned by U.S. resource suppliers in a year is measured by: A) gross domestic product. B) national income. C) personal income. D) disposable income. 3. The term "real GDP" refers to: A) the value of the domestic output after adjustments have been made for environmental pollution and changes in the distribution of income. B) GDP data that embody changes in the price level, but not changes in physical output. C) GDP data that reflect changes in both physical output and the price level. Page 1

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4. GDP differs from NDP in that: A) GDP is based on gross exports, while NDP is based on net exports. B) GDP includes, but NDP excludes, indirect business taxes. C) net investment is used in calculating GDP and gross investment is used in calculating NDP. D) gross investment is used in calculating GDP and net investment is used in calculating NDP. 5. A nation's stock of capital goods will decline when: A) gross investment exceeds net investment. B) net investment is positive, but less than gross investment. C) depreciation exceeds gross investment. D) gross investment exceeds depreciation. 6. Consumption of fixed capital (depreciation) can be determined by: A) adding indirect business taxes to NDP. B) subtracting NDP from GDP. C) subtracting net investment from GDP. D) adding net investment to gross investment. 7. If personal income exceedes national income in a particular year, we can conclude that: A) transfer payments exceeded the sum of social security contributions, corporate income taxes, and indirect business taxes. B) the sum of social security contributions, corporate income taxes, and undistributed corporate profits exceeded transfer payments. C) consumption of fixed capital and indirect business taxes exceeded personal taxes. D) transfer payments exceeded the sum of social security contributions, corporate income taxes, and undistributed corporate profits. 8. The consumption schedule is such that: A) both the APC and the MPC increase as income rises. B) the APC is constant and the MPC declines as income rises. C) the MPC is constant and the APC declines as income rises.
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Mock Exam - Summer 2003 MBA 501-01 Economics Survey Tong...

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