AP economics 1st 9wk 6 week Test

The circular-flow model indicates that final goods are produced by

• firms and sold in the factor markets

• firms and sold in the product markets

• firms and sold in the resource markets

• households and sold in the factor markets

• households and sold in the product markets

Which of the following is true according to the circular flow model?

• Firms are suppliers in both the product and factor markets.

• Firms are demanders in the product markets and suppliers in the factor markets.

• Households are demanders in both the product and factor markets.

• Households are demanders in the product markets and suppliers in the factor markets.

• The government is a demander in the product market only.

Which of the following is most likely included in gross domestic product?

• Matt gives his secondhand bicycle to his brother.

• Sal paints his own bicycle.

• Ali buys a new bicycle.

• Mike buys a share of stock in a bicycle firm.

The value of which of the following is counted in the United States gross domestic product?

• Clean air

• Child care a father provides for his child

• An automobile produced in Sweden by a United States firm

• A car produced in the United States and sold in Europe

The country's gross domestic product is

• $220 billion

• $282 billion

• $304 billion

• $309 billion

GDP does NOT account for which of the following?

• The value added by all firms in the economy

• The depletion of natural resources

• Wages, rent, profit, and interest payments

• The value of final goods and services produced domestically

Which of the following transactions will be included in the calculation of Country X's Gross Domestic Product in 2020?

• The sale of corporate stocks

• The exchange of a used automobile for a used boat

• The purchase of new construction equipment

• Social Security checks received by retirees

As a measure of economic performance, accounts for which of the following?

• Used books donated to a local library

• Depletion of durable consumer goods

• Increased leisure time

• Souvenir gifts purchased by tourists domestically