Quiz - Chapter 21 (Practice)

# Quiz - Chapter 21 (Practice) - Maximum number of choices...

This preview shows pages 1–6. Sign up to view the full content.

Maximum number of choices allowed is {0}. Points Awarded 160.00 Points Missed 40.00 Percentage 80.0% 1. Using the data in the above table, net domestic product equals A) \$1,120. B) \$1,280. C) \$1,290. D) \$1,360. Points Earned: 0.0/5.0 Correct Answer(s): A 2. All of the following household expenditures are included in consumption expenditure EXCEPT A) payment to a dentist for filling a tooth. B) purchase of corporate stock. C) purchase of a new purse. D) purchase of hair styling.

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
Points Earned: 5.0/5.0 Correct Answer(s): B 3. The total amount spent on adding to the stock of capital and on replacing depreciated capital is A) consumption on new capital. B) depreciation. C) gross investment. D) net investment. Points Earned: 5.0/5.0 Correct Answer(s): C 4. Real GDP is not a perfect indicator of economic welfare because ________. A) it includes the underground economy B) it includes a direct measure of health and life expectancy C) it underestimates inflation D) economic welfare depends on many factors not measured or not measured accurately by real GDP Points Earned: 5.0/5.0 Correct Answer(s): D
5. The chain-weighted output index method of measuring real GDP is based on A) using current prices rather than base year prices B) averaging the market value of the expenditures over a two year period and then comparing with a base period. C) using the prices of two adjacent years to calculate the growth rate of real GDP. D) averaging the nominal and real measures of GDP to come up with a more accurate figure. Points Earned: 5.0/5.0 Correct Answer(s): C 6. If nominal GDP is \$5 trillion and the GDP deflator is 125, what is real GDP? A) \$4 trillion B) \$.04 trillion C) \$625 trillion D) \$6.25 trillion Points Earned: 5.0/5.0 Correct Answer(s): A 7. An example of "investment" in computing real GDP using the expenditure approach is the purchase of A) a new set of tools by an auto mechanic, for use in repairing cars.

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
B) 100 shares of IBM stock. C) a 100 year old house by a married couple. D) computer chips by Dell to put in their personal computers. Points Earned: 0.0/5.0 Correct Answer(s): A 8. The underground economy exists for all of the following reasons EXCEPT the A) production of illegal goods. B) avoidance of taxes. C) desire to maintain accurate records of economic transactions. D) avoidance of government regulation. Points Earned: 5.0/5.0 Correct Answer(s): C 9. In the expenditure approach to GDP, the largest component is A) government expenditure on goods and services. B) personal consumption expenditures. C) gross private domestic investment. D) net exports.
Points Earned: 5.0/5.0 Correct Answer(s): B 10. What is the value of real GDP if the value of the GDP deflator is 122.5 and nominal GDP is \$825 billion? A) \$6.735 billion

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

## This note was uploaded on 09/13/2011 for the course ECON 206 taught by Professor Parkin during the Spring '11 term at Buena Vista.

### Page1 / 54

Quiz - Chapter 21 (Practice) - Maximum number of choices...

This preview shows document pages 1 - 6. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online