macro_tif1_ch07

Whichof thefollowingwouldbedirectlycountedingdpin2007

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Unformatted text preview: intermediate goods. B) wages and salaries. C) depreciation on plant and equipment. D) the price of all factors of production. Answer: A Diff: 1 Type: MC Page Ref: To pic : 635/215 M S Definition Objective: LO1: Explain how total production is measured AACSB Coding: Analytic Skills Special Feature: None 14. Which of the following would be directly counted in GDP in 2007? A) kitchen cabinets built in 1887, extracted from the 1887 home, and installed in a farm house built in 1950 B) kitchen cabinets built in 1887, extracted from the 1887 home, and installed in a brand new country-style home. C) kitchen cabinets purchased from Home Depot in 2007 to be installed in a house built in 1997 D) None of the above Answer: C Diff: 2 Type: MC Page Ref: To pic : 635/215 M S Conceptual Objective: LO1: Explain how total production is measured AACSB Coding: Reflective Thinking Special Feature: None 15. Table 7-1 Coffee Drinks Coffee Beans 1,000 2,000 3. 00 0.50 Refer to Table 7-1. Suppose that a simple economy produces only four goods and services: sweat shirts, dental examinations, coffee drinks, and coffee beans. Assume all of the coffee beans are used in the production of the coffee drinks. Using the information in the above table, nominal GDP for this simple economy equals A) $6,500. B) 3,090 units. C) $7,500. D) $4,500. Answer: A Diff: 2 Type: MC Page Ref: To pic : 636/216 M S Analytical Objective: LO1: Explain how total production is measured AACSB Coding: Analytic Skills Special Feature: Solved Problem: Calculating 16. GDP Table 7-2 Ketchup 300 5.00 Refer to Table 7-2. Suppose that a simple economy produces only four goods and services: shoes, DVDs, tomatoes, and catsup. Assume one half of the tomatoes are used in making the catsup and the other half of the tomatoes are purchased by households. Using the information in the above table, nominal GDP for this simple economy equals A) $8,000. B) $7,000. C) 2,440 units. D) $6,000. Answer: B Diff: 2 Type: MC Page Ref: To pic : 636/216 M S Analytical Objective: LO1: Explain how total production is measured AACSB Coding: Analytic Skills Special Feature: Solved Problem: Calculating 17. GDP In the circular flow model, the value of total income for an economy ________ the value of total production. A) may be greater than or less than B) is less than C) equals D) is greater than Answer: C Diff: 1 Type: MC Page Ref: To pic : 636-7/216-7 P S Factual Objective: LO1: Explain how total production is measured AACSB Coding: Reflective Thinking Special Feature: None 18. In the circular flow model, the value of total production for an economy ________ the value of total expenditures on final goods and services. A) equals B) is greater than C) may be greater than or less than D) is less than Answer: A Diff: 1 Type: MC Page Ref: To pic : 636-7/216-7 P S Factual Objective: LO1: Explain how total production is measured AACSB Coding: Reflective Thinking Special Feature: None 19. The real GDP of the U.S. in 2006 was approximately $13 trillion. This means that A) total spending in 2006 was around $13 trillion. B) total income in 2006 was around $13 trillion. C) the value of output in 2006 was around $13 trillion. D) all of the above are true. Answer: D Diff: 2 Type: MC Page Ref: To pic : 636-42/216-22 P S Conceptual Objective: LO1: Exp...
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