GDP and the Business Cycle

High levels of GDP per capita indicate...

• Higher levels of happiness 
• Higher standard of living
• Equal levels of wealth 
• Self-sufficient communities

Expectant parents buy supplies for the nursery.  Would this be included in GDP? 

• Yes - Consumer Spending
• Yes - Investment 
• No - Intermediate goods
• No - Non-market activity

The federal government is expected to spend $3.95 trillion this year.  Will this be counted in GDP?

• YES
• NO

Aly spends $400 on used textbooks at the beginning of the semester in college.  Is this included in the GDP?

• YES
• NO

The value of the output of all final goods and services produced within a country in a year.

• total ouput
• Gross Domestic Product
• national income
• net domestic product

GDP is calculated by

• adding up the cost of goods used in producing the item
• subtracting all costs from total revenue
• adding consumption + investment +government spending+ (exports sold - imports bought)

Each individual on food stamps in Delaware can receive up to $194 a month.  Is this included in government spending?

• Yes - Government spending
• Yes - Consumer Spending
• No - Intermediate Goods
• No - Purely financial Transaction 

Tanks and roads belong in which part of the GDP formula?
GDP = C+I+G+(X-M)

• Consumption Expenditures
• Investment Expenditures
• Government Expenditures
• Net Imports

What does X represent in calculating net imports?
X-M

• Imports
• Exports
• Expenditures
• None of the Above

What does M represent in calculating net imports?
X-M

• Imports
• Exports
• Taxes
• None of the Above