WorksheetsNational Income
Total questions: 10
Worksheet time: 7mins
What is GDP?
the monetary value of all goods and services (final, intermediate, and non market) produced in a given year
Total resource income less taxes, saving, and spending on exports.
the economic value of all economic resources used in the production of a year's output.
the market value of all final goods and services produced within a nation in a specific year
Which of the following is a final good or service?
Diesel fuel bought for a delivery truck
Fertilizer purchased by a farm supplier
A haircut
Chevrolet windows purchased by a General Motors assembly plant
Tom Atoe grows tomatoes for home consumption. This activity is
excluded from GDP in order to avoid double counting
excluded from GDP because an intermediate good is involved
productive but is excluded from GDP because no market transaction occurs
included in GDP because it reflects production
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 above data. GDP is:
$116
$121
$125
$150
Assume an economy producing only one product and that year 3 is the base year. Output and price data for a five-year period are as follows. Answer the next question(s) on the basis of these data.
Refer to the data. The nominal GDP for year 4 is
$49
$55
$40
$35
Assume an economy producing only one product and that year 3 is the base year. Output and price data for a five-year period are as follows. Answer the next question(s) on the basis of these data.
Refer to the data, . If year 3 is chosen as the base year, Real GDP for year 5 is
$160
$49
$40
$64
In comparing GDP data over a period of years, a difference between nominal and real GDP may arise because
of changes in trade deficits and surpluses
the length of the workweek has declined historically
the price level may change over time
depreciation may be greater or smaller than gross investment
The GDP tends to
overstate economic welfare because it does not include certain nonmarket activities such as the productive work of housewives
understate economic welfare because it includes expenditures undertaken to offset or correct pollution
understate economic welfare because it does not take into account increases in leisure
overstate economic welfare because it does not reflect improvements in product quality
When the consumer price index falls, the typical family
has to spend more dollars to maintain the same standard of living
can spend fewer dollars to maintain the same standard of living
finds that its standard of living is not affected
can save less because they do not need to offset the effects of rising prices
The price index was 120 in 2012 and 126 in 2013. What was the inflation rate?
5%
6%
7,2%
105%
