Neither exports nor imports are added c Exports are added and imports are

Neither exports nor imports are added c exports are

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Neither exports nor imports are added c) Exports are added and imports are subtracted d) Imports are added and exports are subtracted Suppose that last year domestic firms spent $80 billion on final purchases of plant and equipment, of which $15 billion replaced equipment that had worn out during the year. In addition, firms collectively added $10 billion to inventories and new construction totaled $35 billion. In calculating GDP, national income accountants would add gross investment of: a) $95 billion b) $100 billion c) $110 billion d) $125 billion Suppose nominal GDP in the base year was $380 billion. Five years later, nominal GDP was $480 and the GDP price index was 120. Over those five years, real GDP: a) Increased by $20 billion b) Increased by $96 billion c) Increased by $80 billion d) Did not change Disposable income consists of: a) Personal income plus personal taxes b) Net domestic product minus personal taxes c) GDP corrected for inflation d) Consumption plus saving If prices are inflexible, an unexpected reduction in demand for a firm’s product would result in:
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a) Immediate cuts in both production and desired inventory levels b) Falling inventories followed by cuts in production c) Rising inventories followed by increased employment of resources d) Rising inventories followed by cuts in production An unexpected drop in consumer spending would be classified as a: a) Positive supply shock b) Negative supply shock c) Negative demand shock d) Positive demand shock The purchase of corporate stock is considered: a) An economic investment b) The same as the purchase of new plant and equipment c)
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  • Fall '10
  • staff
  • Macroeconomics, gross domestic product, Measures of national income and output, Net Domestic Product, foreign factor income, D M. Production

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