Economics Unit 3 test

What is the main economic indicator that economists look at to analyze the state of a nation's economy?

• Net National Product

• Gross National Income

• Greater Domestic Production

• Gross Domestic Product

What is the formula to calculate GDP? (no spaces)

Match the following expenses to their correct categories.

• A farmer buys a dairy cow.

• Government spending

• Ms. Zgabay buys milk at the store.

• Investment

• The Department of Transportation maintains the roads that transport dairy.

• Net exports

• The farmer sells his milk to a customer in Canada.

• Consumption

Which type of GDP does not account for rising costs or inflation?

• Real

• Nominal

• Calculated

• Approximate

Which of these would not be included in America's GDP calculations?

• Fabrics made in China and sold in Texas

• Computers made in the USA and sold in Canada

• A professional nanny that reports income to the IRS

• Home repairs that you hire someone to complete at your house

Label each stage of the business cycle correctly.

a

b

c

d

Contraction

Expansion

Peak

Trough

The United States has been able to avoid entering a stage of ________, which is six months in a row of a declining GDP.

Reorder the following based on the order that they happen when it comes to predicting business cycles.

• Lagging indicators

• Leading indicators

• Coincident indicators

Which word is defined as "individuals and businesses producing a narrow range of products"?

• Economic interdepence

• Gross domestic product

• Exporting

• Specialization

If the United States produces airplane parts and sells them in France, this is considered an ________ of the United States.

• Import

• Export