Chapter 7 – Flashcards

A nation's gross domestic product (GDP):

Net exports are:

If there are no statistical discrepancies, NDP (net domestic product) is:

Historically, real GDP has increased less rapidly than nominal GDP because:

If nominal GDP rises:

In calculating the GDP, national income accountants:

Assume that the size of the underground economy increases both absolutely and relatively over time. As a result:

The purchase of Walmart stock is a part of gross investment, but not of net investment.

Government purchases include government spending on:

Welfare payments to low-income families are included in national income.

What is the difference between national income and personal income?

All expenditures on new construction are included as investment in calculating GDP.

The value of U.S. imports is:

Real GDP refers to:

If real GDP is 50 and nominal GDP is 100, the GDP price index is 200.

The National Income and Product Accounts (NIPA) help economists and policymakers to:

A large underground economy results in an:

In 1933, net private domestic investment was a minus $6.0 billion. This means that:

Consumption of fixed capital (depreciation) can be determined by:

The growth of GDP may understate changes in the economy's economic well-being over time if the:

(Last Word) Which of the following is a source of data for the consumption component of the U.S. GDP?

If real GDP rises and the GDP price index has increased:

Suppose nominal GDP was $360 billion in 1990 and $450 billion in 2000. The appropriate price index (1985 = 100) was 120 in 1990 and 125 in 2000. Between 1990 and 2000 real GDP:

The ZZZ Corporation issued $25 million in new common stock in 2013. It used $18 million of the proceeds to replace obsolete equipment in its factory and $7 million to repay bank loans. As a result, investment:

If depreciation exceeds gross investment:

Tom Atoe grows fruits and vegetables for home consumption. This activity is:

Which of the following do national income accountants consider to be investment?

If nominal GDP is 150 and the GDP price index is 200, real GDP is 75.

Answer the question on the basis of the following data. All figures are in billions of dollars: Government Purchases $15 Consumption 90 Gross investment 20 consumption of fixed capital 5 exports 8 imports 12 Refer to the data. GDP is:

Answer the question on the basis of the following information: Only three goods are produced in an economy in the following amounts: A = 10, B = 30, C = 5. The current year per unit prices of these three goods are A = $2, B = $3, and C = $1. (Advanced analysis) Refer to the information. If the per unit prices of the three goods were each $1 in a base year used to construct a GDP price index, then real GDP in the current year is:

Answer the question on the basis of the following information: Only three goods are produced in an economy in the following amounts: A = 10, B = 30, C = 5. The current year per unit prices of these three goods are A = $2, B = $3, and C = $1. (Advanced analysis) Refer to the information. If the per unit prices of the three goods were each $1 in a base year used to construct a GDP price index, then the GDP price index in the current year is: Question 29 options:

Suppose that inventories were $40 billion in 2012 and $50 billion in 2013. In 2013, national income accountants would:

Which of the following is a final good or service?

Answer the question on the basis of the following national income data for the economy. All figures are in billions of dollars. Personal Consumption Expenditures 400 Government Purchases 128 Gross Private Domestic Investment 88 Net Exports 7 Net Foreign Factor Income 0 Consumption of Fixed Capital 43 Taxes on Production and Imports 50 Compensation of Employees 369 Rents 12 Interests 15 Proprietor's Income 52 Corporate Income Taxes 36 Dividends 24 Undistributed Corporate Profits 22 Statistical Discrepancy 0 The gross domestic product for the above economy is:

Answer the next question(s) on the basis of the following data. All figures are in billions of dollars. Personal taxes $40 Social Security Contributions 15 Taxes on Production and Imports 20 Corporate Income Taxes 40 Transfer Payments 22 US Exports 24 Undistributed Corporate Profits 35 Government Purchases 90 Gross Private Domestic Investment 75 US Imports 22 Personal Consumption Expenditures 250 Consumption of Fixed Capital 25 Net Foreign Factor 10 Statistical Discrepancy 0 Refer to the above data. DI is:

Answer the question on the basis of the following national income data. All figures are in billions of dollars. Net Private Domestic Investment 33 Net Exports 6 National Income 278 US Exports 20 Gross Private Domestic Investment 56 Disposable Income 220 Taxes on Production and Imports 32 Undistributed Corporate Profits 15 Proprietor's Income 45 Net Foreign Factors Income 0 Statistical Discrepancy 0 Refer to the data. The gross domestic product is: