MidSession01_Answer_Key - Economics 104 Midterm 1 Exam with...

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Economics 104 Midterm 1 Exam with Answer Key (see last page) October 2010 1. The total market value of production in an economy must equal the total value of A. profits. B. revenues from all transactions. C. consumption. D. investment. E. spending on final goods and services. 2. The largest expenditure component of Canada's GDP is A. consumption. B. private-sector investment. C. government purchases. D. exports. E. imports. 3. Private-sector investment includes spending on A. durables, nondurables, and services. B. stocks, bonds, and other financial instruments. C. capital goods, residential housing, and changes in inventories. D. goods and services by federal, provincial, and local governments. E. goods and services sold abroad minus goods and services produced abroad. 4. The total incomes of capital and labour must equal total A. production. B. profits. C. revenue. D. consumption. E. investment. 5. The largest single income component of income-based GDP is A. wages, salaries, and supplementary labour income. B. corporate and like profits before taxes. C. net farm and small business income. D. interest and miscellaneous income. E. capital consumption allowances.
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A. higher-priced items count more. B. GDP increases when not all goods are produced in greater quantities. C. market prices generally reflect the economic benefit consumers expect to receive from an item. D. not all economically valuable goods and services are bought and sold in markets. E. lower-priced items count more. 7. Real GDP measures the _______ of production and nominal GDP measures the _______ of production. A. current-dollar value; physical volume B. current-dollar value; current-dollar value C. current-dollar value; market value D. constant-dollar value; current-dollar value E. physical volume; physical volume 8. Real GDP may be calculated by dividing _______ by _______. A. nominal GDP; the GDP deflator B. the GDP deflator; nominal GDP C. nominal GDP; real GDP D. the price index; nominal GDP E. real GDP; nominal GDP 9. A proposal to increase the age at which people become eligible for government pensions would A. increase GDP, leaving everything else the same. B. decrease GDP, leaving everything else the same. C. leave GDP unchanged. D. increase GDP at the expense of non-working time. E. increase GDP and non-working time. A jar of orange marmalade, ultimately sold to a customer at The Corner Store, is produced by the following production process: 10. What is the value added of Florida Jam Company? A. $0.00. B. $0.50. C. $0.75. D. $1.25. E. $2.00.
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This note was uploaded on 01/28/2011 for the course ECON 104 taught by Professor Voss during the Winter '10 term at University of Victoria.

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MidSession01_Answer_Key - Economics 104 Midterm 1 Exam with...

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