Question 1

Changes in nominal GDP always reflect changes in real output.

Accepted Answer

A) True 
 B)False

Question 2

Aneta has owned an Italian sports car for several years and now she wants to sell it.She paid $8,500 for it in 1993 and she has just sold it for $39,000 in 2015.How is this sale included in the GDP for 2015?

Accepted Answer

A)  $8,500 is included in 2015 GDP 
B)  $39,000 is included in 2015 GDP 
C)  The increase in value of $10,500 is included in 2015 GDP 
D)  It is not included in 2015 GDP

Question 3

Economic fluctuations in the United States have been less extreme since the 1950s.

Accepted Answer

A) True 
 B)False

Question 4

Does GDP for a particular year include items produced in a previous year?

Accepted Answer

A)  Nominal GDP will not and real GDP will 
B)  Real GDP will and nominal GDP will not 
C)  Yes for both nominal and real GDP 
D)  No for both nominal and real GDP

Question 5

Aggregate demand and supply curves have been widely used to analyze the performance of the macroeconomy.Figure 5-3 shows four diagrams that represent different changes in the macroeconomy.Choose the diagram that best represents the situations described in the following questions.??Figure 5-3
 
-Which graph in Figure 5-3 best represents the favorable macroeconomy of the late 1990s?

Accepted Answer

A)  1 
B)  2 
C)  3 
D)  4

Question 6

If Honda (a Japan-based firm)  produces a car in Ohio and exports it to Japan, in which country's GDP will the car be counted?

Accepted Answer

A)  Japan's, because Honda is a Japanese company 
B)  Japan's because that is where the car is purchased 
C)  The GDP of the United States because that is where it was built 
D)  Both Japan and the United States

Question 7

Gross Domestic Product is the

Accepted Answer

A)  least inclusive aggregate used to measure the economy.
B)  total of goods and services desired by consumers.
C)  most comprehensive measure of total output in the United States.
D)  most accurate measure of the trade balance of the United States.

Question 8

In the aggregate demand-aggregate supply model, economic growth can be illustrated by an

Accepted Answer

A)  outward shift of the aggregate demand curve.
B)  inward shift of the aggregate demand curve.
C)  inward shift of the aggregate supply curve.
D)  All of the above.

Question 9

The vertical axis of the aggregate demand-aggregate supply model measures the amount of

Accepted Answer

A)  total employment.
B)  total final output.
C)  the price level.
D)  net exports.

Question 10

Stabilization policy often faces a trade-off between inflation and unemployment.

Accepted Answer

A) True 
 B)False

Question 11

If the prices of all goods and services rise during the year,

Accepted Answer

A)  real GDP may fall.
B)  nominal GDP must rise.
C)  nominal GDP may increase.
D)  real GDP must rise.

Question 12

Part of the good economic performance of the United States in the 1990s can be explained by a rightward-shifting aggregate supply curve.

Accepted Answer

A) True 
 B)False

Question 13

Economists define an aggregate as

Accepted Answer

A)  a concrete object.
B)  a specific principle.
C)  a representative good or service.
D)  a useful abstraction.
E)  something immeasurable.

Question 14

Government policy to reduce unemployment and increase national output can be illustrated by an

Accepted Answer

A)  outward shift of the aggregate demand curve caused by an increase in government spending.
B)  outward shift of the aggregate supply curve caused by a reduction in government spending.
C)  inward shift of the aggregate demand curve caused by an increase in government spending.
D)  inward shift of the aggregate supply curve caused by a reduction in government spending.

Question 15

Nominal GDP is

Accepted Answer

A)  also called real GDP.
B)  a more accurate measure than real GDP.
C)  real GDP adjusted for changes in the price level.
D)  GDP measured in current prices.

Question 16

Intermediate goods, like milk sold by a farmer to a supermarket, are

Accepted Answer

A)  included in GDP.
B)  included in GDP at market value.
C)  included if it is imported.
D)  are not included in GDP.

Question 17

A recession is a period during which

Accepted Answer

A)  aggregate demand, production, and unemployment rises.
B)  aggregate demand, production, and unemployment falls.
C)  aggregate demand, production, and unemployment remain the same.
D)  aggregate demand and production rises while unemployment remains the same.
E)  aggregate demand and production falls while unemployment rises.

Question 18

Define the following terms and explain their importance to the study of macroeconomics:
a.aggregation
b.recession
c.gross domestic product
d.final goods and services
e.stabilization policy

Accepted Answer

omprehension
a.Aggregation means combini...

Question 19

Real GDP

Accepted Answer

A)  is nominal GDP adjusted for changes in the price level.
B)  is also called nominal GDP.
C)  measures GDP minus depreciation of capital.
D)  will always change when prices change.

Question 20

China is the world's largest wheat producer.If China's domestic product grew by eleven percent in the previous year, it implies that

Accepted Answer

A)  production of wheat grew by more than eleven percent.
B)  products other than wheat grew by less than eleven percent.
C)  China's overall output grew by eleven percent.
D)  production of wheat is declining in China.

Exam 22: An Introduction to Macroeconomics

Economists define an aggregate as

Correct Answer
verified

Correct Answer
verified

A recession is a period during which

Correct Answer
verified

Part of the good economic performance of the United States in the 1990s can be explained by a rightward-shifting aggregate supply curve.

Correct Answer
verified

Define the following terms and explain their importance to the study of macroeconomics: a.aggregation b.recession c.gross domestic product d.final goods and services e.stabilization policy

Correct Answer
verified
omprehension
a.Aggregation means combini...
View Answer

Government policy to reduce unemployment and increase national output can be illustrated by an

Correct Answer
verified

In the aggregate demand-aggregate supply model, economic growth can be illustrated by an

Correct Answer
verified

Intermediate goods, like milk sold by a farmer to a supermarket, are

Correct Answer
verified

Changes in nominal GDP always reflect changes in real output.

Correct Answer
verified

Real GDP

Correct Answer
verified

Aneta has owned an Italian sports car for several years and now she wants to sell it.She paid $8,500 for it in 1993 and she has just sold it for $39,000 in 2015.How is this sale included in the GDP for 2015?

Correct Answer
verified

China is the world's largest wheat producer.If China's domestic product grew by eleven percent in the previous year, it implies that

Correct Answer
verified

Gross Domestic Product is the

Correct Answer
verified

If the prices of all goods and services rise during the year,

Correct Answer
verified

The vertical axis of the aggregate demand-aggregate supply model measures the amount of

Correct Answer
verified

Stabilization policy often faces a trade-off between inflation and unemployment.

Correct Answer
verified

Economic fluctuations in the United States have been less extreme since the 1950s.

Correct Answer
verified

If Honda (a Japan-based firm) produces a car in Ohio and exports it to Japan, in which country's GDP will the car be counted?

Correct Answer
verified

Nominal GDP is

Correct Answer
verified

Does GDP for a particular year include items produced in a previous year?

Correct Answer
verified

Exam 22: An Introduction to Macroeconomics

Economists define an aggregate as

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A recession is a period during which

Correct AnswerverifiedShow Answer

Part of the good economic performance of the United States in the 1990s can be explained by a rightward-shifting aggregate supply curve.

Correct AnswerverifiedShow Answer

Define the following terms and explain their importance to the study of macroeconomics: a.aggregation b.recession c.gross domestic product d.final goods and services e.stabilization policy

Correct Answerverifiedomprehensiona.Aggregation means combini...View AnswerShow Answer

Government policy to reduce unemployment and increase national output can be illustrated by an

Correct AnswerverifiedShow Answer

In the aggregate demand-aggregate supply model, economic growth can be illustrated by an

Correct AnswerverifiedShow Answer

Intermediate goods, like milk sold by a farmer to a supermarket, are

Correct AnswerverifiedShow Answer

Changes in nominal GDP always reflect changes in real output.

Correct AnswerverifiedShow Answer

Real GDP

Correct AnswerverifiedShow Answer

Aneta has owned an Italian sports car for several years and now she wants to sell it.She paid $8,500 for it in 1993 and she has just sold it for $39,000 in 2015.How is this sale included in the GDP for 2015?

Correct AnswerverifiedShow Answer

China is the world's largest wheat producer.If China's domestic product grew by eleven percent in the previous year, it implies that

Correct AnswerverifiedShow Answer

Gross Domestic Product is the

Correct AnswerverifiedShow Answer

If the prices of all goods and services rise during the year,

Correct AnswerverifiedShow Answer

The vertical axis of the aggregate demand-aggregate supply model measures the amount of

Correct AnswerverifiedShow Answer

Stabilization policy often faces a trade-off between inflation and unemployment.

Correct AnswerverifiedShow Answer

Economic fluctuations in the United States have been less extreme since the 1950s.

Correct AnswerverifiedShow Answer

If Honda (a Japan-based firm) produces a car in Ohio and exports it to Japan, in which country's GDP will the car be counted?

Correct AnswerverifiedShow Answer

Nominal GDP is

Correct AnswerverifiedShow Answer

Does GDP for a particular year include items produced in a previous year?

Correct AnswerverifiedShow Answer

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omprehension
a.Aggregation means combini...
View Answer

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