Question :
61) The table above gives the production and prices for : 1228212
61) The table above gives the production and prices for a small nation that produces only bread and soda. The base year is 2010. What is real GDP in 2010?
A) $530
B) $1080
C) $510
D) $210
E) $300
62) When calculating real GDP, the reference base year
A) allows us to account for changes in GNP compared to GDP.
B) always reduces the value of GDP compared to GNP.
C) allows us to calculate the value of the goods and services in terms of prices of that base year.
D) usually increases the value of GNP compared to GDP.
E) allows us to increase the value of goods and services.
63) In calculating GDP, economists
A) measure total expenditure as the only true measure.
B) can measure either total expenditure or total income.
C) measure total income as the only true measure.
D) measure total income minus total expenditure.
E) measure total income plus total expenditure.
64) The expenditure approach to measuring GDP is based on summing
A) wages, interest, rent, and profit.
B) each industry’s production.
C) the total values of final goods, intermediate goods and services, used goods, and financial assets.
D) consumption expenditure, investment, government expenditure on goods and services, and net exports of goods and services.
E) consumption expenditure, investment, government expenditure on goods and services, and net exports of goods and services minus wages, interest, rent, and profit.
65) Which of the following is NOT included in the expenditure approach to calculating GDP?
A) government expenditures on goods and services
B) investment
C) net exports of goods and services
D) wages
E) consumption expenditure
66) Suppose GDP is $10 billion, consumption expenditure is $7 billion, investment is $2 billion, and government expenditure on goods and services is $2 billion. Net exports of goods and services must be
A) $1 billion.
B) -$1 billion.
C) $2 billion.
D) -$2 billion.
E) $10 billion.
67) According to the expenditure approach to measuring GDP, in the United States , the largest component of GDP is
A) consumption expenditure.
B) investment.
C) government expenditure on goods and services.
D) net exports of goods and services.
E) wages.
68) Expenditures in GDP do not include ________.
A) used goods or financial assets
B) financial assets or investment
C) used goods or investment
D) investment, stocks, or bonds
E) government expenditures on goods and services
69) Which of the following is NOT part of the income used in the income approach to measuring GDP?
A) wages
B) rent
C) interest
D) taxes paid by persons
E) profit
70) Which of the following is NOT included in the income approach to calculating GDP?
A) interest
B) wages
C) net exports of goods and services
D) profits
E) rent
71) The sum of the components of incomes is called ________.
A) net domestic product at market prices
B) gross domestic product at market prices
C) gross domestic product at factor cost
D) net domestic product at factor cost
E) GNP
72) Nominal GDP can change
A) only if prices change.
B) only if the quantities of goods and services change.
C) only if prices increase.
D) if either prices or the quantities of goods and services change.
E) only if prices and the quantities of the goods and services change.
73) A south sea island produces only coconuts. In 2012, the price of a coconut is $1 and the quantity produced is 200. In 2013, the price of a coconut is $1.50 and the quantity produced is 250. 2012 is the base year. Real GDP in 2013 is ________.
A) $375
B) $350
C) $200
D) $250
E) $1.50
74) The difference between nominal GDP and real GDP is
A) the indirect taxes used in their calculations.
B) the prices used in their calculations.
C) that nominal GDP includes the depreciation of capital and real GDP does not.
D) that nominal GDP includes net exports of goods and services and real GDP includes net imports.
E) that real GDP includes the depreciation of capital and nominal GDP does not.
