Unit 4- Review GDP and Inflation

total dollar value of all final goods and services produced within a nation in 1 year.

• Inflation

• Consumer Price Index

• Producer Price Index

• Gross Domestic Product

Which of the following would count towards GDP?

• a pair of shoes purchased at a garage sale

• a consumer purchases stocks and bonds

• A business buys $1 million worth of new capital goods

• the government spends $5 million on social security payments

Choose the two examples that would count towards GDP? (must choose both examples to get this correct)

• The tires that Ford Motor Company puts on a brand new car.

• McDonald's buys a new fry machine

• The government buys ten new tanks

• A consumer purchases a 2005 BMW

Choose the two examples that would count towards the United States GDP. (must choose both examples to get this correct)

• you buy a new pair of jeans

• The government spends $70 million on medicare

• you give 50 cents to a homeless person

• A German company buys $5 million worth of airplanes that were produced in the United States.

This is GDP that has not been adjusted for inflation and it is measured in current dollars. (also called current GDP)

• Real GDP

• Nominal GDP

• per capita GDP

• Real GNP

This is GDP that has been adjusted for inflation and it allows countries to compare GDP from year to year. It is measured in constant dollars and is the most important measure of economic growth.

• Real GDP

• Nominal GDP

• Nominal GNP

• Nominal per capita GDP

Type of inflation in which price levels for goods and services increases by 500 percent or more a year?

• creeping inflation

• galloping inflation

• hyperinflation

• cost-push inflation

inflation caused by consumers spending more money.

• demand-pull inflation

• cost-push inflation

inflation caused by oil prices rising

• demand pull inflation

• cost push inflation

inflation caused by businesses spending more money

• demand pull inflation

• cost push inflation