ECO/372T Principles of Macroeconomics The Latest Version A+ Study Guide
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ECO 372 Week 1 Apply: Output, Income, and Economic Growth Homework Review the Week 1 Output, Income, and Economic Growth Quiz in preparation for this assignment. Complete the Week 1 Output, Income, and Economic Growth Assignment in McGraw-Hill ConnectÂŽ. These are randomized questions. Note: You have only one attempt available to complete assignments. Grades must be transferred manually to eCampus by your instructor. Don't worry, this might happen after your due date.
Which of the following scenarios would be included in GDP?
Darius unclogs the drain in his sink using the plunger he owns. Sandra is a waitress at Morton’s Steakhouse. She receives a cash tip of $50 that she pockets and does not report. Pam buys a new 40-inch television at Walmart. Miguel won $100 in his office fantasy football league.
Which of the following expenditures is an example of a consumer durable good? Marcus buys some new soccer cleats at the sporting
goods store. Arti buys a new refrigerator from Sears. Latisha gets a manicure from the nail salon in the mall. Colin buys a large coffee and a donut from Dunkin' Donuts.
The equation for net investment is written as:
Net Investment = Nominal GDP - Gross Investment Net Investment = Gross Investment - Depreciation Net Investment = Consumption - Gross Investment Net Investment = Depreciation - Gross Investment
Which of the following ly describes GDP using the income approach?
GDP = Wages + Rents + Interest + Profits and Losses + National Income GDP = Consumption + Gross Investment + Net Exports + Government Purchases GDP = Wages + Rents + Interest + Profits and Losses GDP = National Income + Indirect Business Taxes + Depreciation + Net Foreign Factor Income
The major difference between nominal GDP and real
GDP is:
nominal GDP measures the value of output with constant output levels, while real GDP measures output using current-year output levels. nominal GDP measures the value of output in constant prices, while real GDP measures output using currentyear prices. nominal GDP measures the value of output with currentyear output levels, while real GDP measures output using constant output levels. nominal GDP measures the value of output in currentyear prices, while real GDP measures output using constant prices.
The U.S. produces and sells millions of different
products. To aggregate them together into a single measure of domestic output, the quantity of each good produced is weighted by its _____. Multiple Choice
utility to consumers market price
contribution to corporate profits cost of production
A nation’s nominal gross domestic product (GDP) _____.
Multiple Choice
is the dollar value of all final output produced within the borders of the nation during a specific period of time is the dollar value of all final output produced by its citizens, regardless of where they are living is always some amount less than C + I + G + NX can be found by summing C + I + S + NX
Which of the following is not included in gross domestic private investment, as defined in national income accounts?
Multiple Choice
Changes to business inventories The value of all new capital goods bought by business firms Domestic home construction undertaken by and for the private sector Government construction of new highways and dams
GDP measured using current prices is called _____ deflated GDP
constant GDP real GDP nominal GDP
Which of the following is a primary use for national income accounts? Multiple Choice
To analyze the environmental cost of economic growth To assess the economic efficiency of specific industries in
the economy To determine whether there is a fair and equitable distribution of income in the economy To measure changes in the value of production and income in the economy
Final goods and services refer to _____. Multiple Choice
goods and services that are unsold and therefore added to inventories
goods and services purchased by ultimate users, rather than for resale or further processing goods and services whose value has been adjusted for changes in the price level the excess of U.S. exports over U.S. imports
Nominal GDP differs from real GDP because _____. Multiple Choice
nominal GDP is based on constant prices nominal GDP results from adjusting for changes in the price level
real GDP results from adjusting for changes in the price level real GDP is based on current prices
Which of the following is not an example of an intermediate good? Multiple Choice
an oven bought by a homeowner
office supplies bought by an accounting firm gasoline bought by a trucking company flour bought by a bakery
In the treatment of U.S. exports and imports, national income accountants _____. Multiple Choice
subtract exports but add imports in calculating GDP
subtract both exports and imports in calculating GDP add both exports and imports in calculating GDP add exports but subtract imports in calculating GDP
The value of corporate stocks and bonds traded in a given year is _____. Multiple Choice
included in the calculation of net private domestic investment excluded from the calculation of GDP because it does not represent new production included in the calculation of GDP because it is a component of gross investment included in the calculation of gross private domestic investment
Suppose that real GDP per capita in the United States is $49,000. If the long-term growth rate of real GDP per capita is 1.6% per year, how many years will it take for real GDP per capita to reach $98,000? Instructions: Enter your answer as a whole number. years
The table below shows real GDP per capita for the United
States
between
the
Real GDP per Capita over Time
years
1950–2016.
Real GDP per Year
Capita (dollars)
1950
$13,819
1975
24,601
2000
43,935
2016
52,172
Instructions: Round your answers to one decimal place. a. What is the growth rate in the standard of living from 1950 to 1975? b. What is the growth rate in the standard of living from 1975 to 2000? c. What is the growth rate in the standard of living from 2000 to 2016?
Suppose that Italy can produce either goods or services with its resources, and that its PPF curve is shown on the graph as PPF1. Using the graph, for each of the following situations, determine whether the PPF curve shifts. a. Suppose that Italy increases its spending on education, which increases the amount of human capital in Italy. Italy's PPF curve would b. A recession causes Italy's unemployment rate to increase above the natural rate of unemployment. Italy's PPF curve would c. Italy experiences an influx of immigrants from
surrounding countries, which causes the population of Italy to increase. Italy's PPF curve would
Which of the following is a measure of economic growth that is most useful for comparing changes in standards of living? Multiple Choice
increases in real GDP
increases in real GDP per capita growth in nominal GDP decreases in the rate of unemployment
The benefits of economic growth are _____, while the costs of economic growth are _____. Multiple Choice
increased output per person; the consumption sacrificed
in exchange for capital formation increased output per person; less future consumption increased output per person; too small for concern more current consumption; less future consumption
Use the following production possibilities frontiers to answer the next question.
Curve (a) is the current frontier for the economy. Focusing on curve (a), point N suggests that the economy currently produces Multiple Choice
more goods for the future than at point P. less goods for the present than at point P. less goods for the future than at point P. a combination of output that is less than its potential.
The application of new technologies to the production process will increase Multiple Choice
labor productivity. the share of the population employed. the unemployment rate. the quantity of human capital.
Real GDP per capita is found by Multiple Choice
dividing real GDP by population. subtracting population from real GDP. dividing population by real GDP. adding real GDP and population.
Human capital is Multiple Choice
the financial resources available to humans for investment. the talents, training, and education of workers. the factories and machinery used by humans in the production process. the factories and machinery made by workers.
To increase future living standards by pursuing higher current rates of investment spending, an economy must Multiple Choice
reduce the current capital stock. allow higher rates of current consumption. reduce current rates of consumption spending. decrease
the
amount
of
future
research
and
development spending.
Which of the following is a measure of economic growth that is most useful for measuring changes in the overall size of an economy?
Multiple Choice
decreases in the rate of unemployment increases in real GDP increases in real GDP per capita growth in nominal GDP
Human capital refers to the
Multiple Choice
amount of financing available to start-up firms. tools and equipment available to workers. education, training, and skills of workers. number of workers available in the economy.
Economic growth can best be portrayed as a(n)
Multiple Choic outward shift of the production possibilities frontier. movement from a point inside to a point outside of the production possibilities frontier. inward shift of the production possibilities frontier. movement from a point near the vertical axis to a point near the horizontal axis on the production possibilities frontier.
The cost of a higher living standard in the future is giving up Multiple Choice current consumption.
current investment. future consumption. future investment.
The principle of diminishing returns to capital states that if the amount of labor and other inputs employed is held constant, then the greater the amount of capital in use the
Multiple Choice
the less an additional unit of capital adds to production. less is produced. the more an additional unit of capital adds to production. less production is wasted.