WorksheetsC1: NATIONAL INCOME ACCOUTING & BOP
Total questions: 40
Worksheet time: 20mins
Over the decade from 1991 to 2000,
A. Japan’s national product grew at an annual average rate of only 3.0 percent
while that of the United States grew by nearly 3.5 percent per year.
B. Japan’s national product grew at an annual average rate of only 1.5 percent
while that of the United States grew by nearly 3.5 percent per year.
C. The United States’ national product grew at an annual average rate of only 1.
percent while that of Japan grew by nearly 3.5 percent per year.
D. Japan’s national product grew at the same annual average rate as that of the
United States.
E. Japan’s national product grew at an annual average rate of 3.5 percent while
that of the United States grew only by 1.5 percent per year.
Q2: A country’s gross national product (GNP) is
A. the value of all final goods and services produced by its factors of production
and sold on the market in a given time period.
B. the value of all intermediate goods and services produced by its factors of
production and sold on the market in a given time period.
C. the value of all final goods produced by its factors of production and sold on
the market in a given time period.
D.the value of all final goods and services produced by its factors of production
and sold on the market.
Over the decade from 1991 to 2000,
A. Japan’s unemployment rate rose, reaching nearly 3 percent.
B. Japan’s unemployment rate rose, reaching nearly 4 percent.
C. Japan’s unemployment rate rose, reaching nearly 5 percent and overtaking
that of the United States for the first time in fifty years.
D. Japan’s unemployment rate rose, reaching nearly 8 percent and overtaking
that of the United States for the first time in fifty years.
E. Japan’s unemployment rate rose, reaching nearly 5 percent.
For most macroeconomists,
A. national income accounts and national output accounts are equal to each other.
B. national income accounts exceed national output accounts.
C. national output accounts exceed national income accounts.
D. it is impossible to tell whether national income accounts are equal to national
output accounts.
E. None of the above
For most macroeconomists,
A. gross national income and gross national product are the same.
B. gross national income exceeds gross national product.
C. gross national product exceeds gross national product.
D. it is hard to tell whether gross national income equals gross national product.
E. None of the above
The highest component of GNP is
A. the current account.
B. investment.
C. consumption.
D. None of the above.
The GNP of the United States in 2000 was about
A. 7 trillion dollars.
B. 8 trillion dollars.
C. 1 trillion dollars.
D. 5 trillion dollars.
D. 10 trillion dollars.
In 2000, the United States had
A. a surplus in the current account.
B. a balanced current account.
C. a deficit in the current account.
D. It is hard to tell from the data whether in 2000 the United States had a deficit
or a surplus in the current account.
E. None of the above.
In order to move from units expressed in trillion to units expressed in billions, you
need to multiple the number in billions by
A. 100.
B. 10,000.
C. 100,000.
D. 1,000,000.
1,000.
The sale of
A. a used textbook does enter GNP.
B. a used textbook does not enter GNP, but the sale of a used house does.
C. both a used textbook and a used house do not enter GNP.
D. a used house does not enter GNP, but the sale of a used book does.
None of the above
Which one of the following statements is the most accurate?
A. The sale of a used textbook does generate income for factors of production.
B. The sale of a used textbook does not generate income for any factor of
production.
C. The sale of a used textbook sometimes does and sometimes does not generate
income for factors of production.
It is hard to tell whether a sale of a used textbook does or does not generate
income for factors of production.
None of the above.
Which one of the following statements is the most accurate?
A. GNP plus depreciation is called net national product (NNP).
B. GNP less depreciation is called net national product (NNP).
C. GNP less depreciation is called net factor product (NFP).
Answers A and C are both correct.
None of the above.
National income equals GNP
A. less depreciation, less net unilateral transfers, less indirect business taxes.
less depreciation, plus net unilateral transfers, plus indirect business taxes
C. less depreciation, less net unilateral transfers, plus indirect business taxes.
plus depreciation, plus net unilateral transfers, less indirect business taxes.
E. less depreciation, plus net unilateral transfers, less indirect business taxes.
Which one of the following expressions is the most accurate?
CA = EX – IM.
CA = IM – EX.
CA=EX=IM.
CA = EX + IM.
None of the above.
The United States began to report its gross domestic product (GDP) only since
A. 1900
B. 1921
C. 1931
D. 1941
E. 1991
GDP is supposed to measure
A. the volume of production within a country’s borders.
B. the volume of services generated within a country’s borders.
C. the volume of production of a country’s output.
D. GNP plus depreciation.
E. None of the above.
GNP equals GDP
minus net receipts of factor income from the rest of the world.
plus receipts of factor income from the rest of the world.
minus receipts of factor income from the rest of the world.
plus net receipts of factor income from the rest of the world.
None of the above
Movements in GDP
and GNP usually do not differ greatly.
and GNP usually do not differ greatly, as a practical matter.
and GNP usually do differ greatly
are usually smaller than those of GNP movements, in practice.
None of the above
In open economies,
saving and investment are necessarily equal.
as in a closed economy, saving and investment are not necessarily equal.
saving and investment are not necessarily equal as they are in a closed
economy.
saving and investment are necessarily equal contrary to the case of a closed
economy.
None of the above.
In the United States since the Korean War, the fraction of GNP devoted to
consumption has fluctuated in a range of about
42 to 49 percent.
32 to 39 percent.
22 to 29 percent.
82 to 89 percent.
62 to 69 percent.
Purchases of inventories by
firms are not counted in investment spending.
firms are also counted in investment spending.
households are also counted in investment spending.
households and firms are also counted in investment spending.
None of the above.
Investment is usually
more variable than consumption.
less variable than consumption.
as variable as consumption.
It is hard to tell from the data whether investment is more or less variable than
consumption.
None of the above.
Any goods
purchased by federal, state, or local governments are classified as government
purchases.
and services purchased only by federal government are classified as
government purchases.
and services purchased only by federal or state governments are classified as
government purchases.
and services purchased by federal, state, or local governments are classified as
government purchases.
None of the above.
Government transfer payments such as social security and unemployment benefits
are
included in government purchases.
not included in government purchases.
not included in government purchases, but they are included in the
consumption component of GNP.
not included in government purchases, but they are part of the investment
component of GNP.
None of the above.
Government purchases currently take up about
18 percent of U.S. GNP, and this share has not changed much since the late
1950s
38 percent of U.S. GNP, and this share has not changed much since the late
1950s
18 percent of U.S. GNP, and this share has been increasing since the late
1950s.
18 percent of U.S. GNP, and this share has been decreasing since the late
1950s.
None of the above.
In 1929, government purchases accounted for
only 18.5 percent of U.S. GNP.
only 8.5 percent of U.S. GNP.
28.5 percent of U.S. GNP.
38.5 percent of U.S. GNP.
8.5 percent of U.S. GNP.
A country’s current account
balance equals the change in its net foreign wealth.
balance equals the change in its foreign wealth.
surplus equals the change in its foreign wealth.
deficit equals the change in its foreign wealth.
None of the above
The CA is equal to
Y – (C-I+G).
Y + (C+I+G)
Y – (C+I+G)
Y – (C+I-G).
Y – (C+I+G) = -CA, (i.e., minus the CA).
Which one of the following statements is the most accurate?
It is not hard to measure accurately a country’s net foreign wealth
It is surprisingly hard to measure accurately a country’s net foreign wealth.
It is surprisingly hard to measure a country’s foreign wealth.
It is surprisingly hard to measure accurately a country’s foreign transactions.
None of the above.
Over the 1980s,
there is no question that a large increase in U.S. foreign assets did occur.
there is a question whether a large decrease in U.S. foreign assets did occur.
there is no question that a large decrease in U.S. foreign assets did occur.
there is no question that there was almost no change in U.S. foreign assets.
None of the above.
In a closed economy, national saving
sometimes equals investment
always equals investment.
is always less than investment.
is always more than investment.
. None of the above.
Disposable income is National income
less taxes collected from households and firms by the government.
plus net taxes collected from households and firms by the government.
less net taxes collected from households and firms by the government
less net taxes collected from households by the government.
less net taxes collected from households and firms by the government.
Government savings, Sg, is equal to
T – G.
T + G.
T = G.
T + G – I.
None of the above.
In a closed economy, private saving, Sp, is equal to
I - (G – T).
I + (G – T).
I + (G + T).
I - (G + T).
I + (G – T) + C.
In an open economy, private saving, Sp, is equal to
I - CA + (G - T).
I + CA - (G - T).
I + CA + (G - T).
I - CA - (G - T).
I + CA + (G + T).
Ricardian equivalence argues that when the government cuts taxes and raises its
deficit,
consumers anticipate that they will face lower taxes later to pay for the
resulting government debt.
consumers anticipate that they will receive better services from the
government.
consumers anticipate that they will face higher taxes later to pay for the
resulting government debt.
consumers anticipate it will affect their future taxes, in general in the direction
of lowing future taxes.
None of the above.
Ricardian equivalence argues that when the government
increases taxes and raises its deficit, consumers anticipate that they will face
higher taxes later to pay for the resulting government debt, thus people will
raise their own private saving to offset the fall in government saving.
cuts taxes and decreases its deficit, consumers anticipate that they will face
higher taxes later to pay for the resulting government debt, thus people will
raise their own private saving to offset the fall in government saving.
cuts taxes and raises its surplus, consumers anticipate that they will face
higher taxes later to pay for the resulting government debt, thus people will
raise their own private saving to offset the fall in government saving.
cuts taxes and raises its deficit, consumers anticipate that they will face lower
taxes later to pay for the resulting government debt, thus people will raise
their own private saving to offset the fall in government saving.
cuts taxes and raises its deficit, consumers anticipate that they will face higher
taxes later to pay for the resulting government debt, thus people will raise
their own private saving to offset the fall in government saving.
Every international transaction automatically enters the balance of payments
once either as a credit or as a debit.
twice, once as a credit and once as a debit.
once as a credit.
twice, both times as debit.
None of the above.
An American travels to Paris and pays for a $100 dinner with the credit card issued by an U.S. company. How is this accounted for in the U.S. balance of payments?
Current account, French service import
Current account, U.S. good export
Financial account, U.S. asset export
Financial account, U.S. asset import
None of the above
The earnings of a Spanish factory with British owners are
counted in Spain’s GDP
are part of Britain’s GNP
are counted in Britain’s GDP
are part of Spain’s GNP
Only (a) and (b)
