Question : 13.2   National Income Accounting for an Open Economy 1) Movements in : 1303562

 

13.2   National Income Accounting for an Open Economy

 

1) Movements in GDP

A) differ greatly from movements in GNP.

B) do not differ greatly from movements in GNP.

C) are not allowed to differ at all from movements in GNP by definition.

D) need to be inflation adjusted in order to match movements in GNP.

E) are not relevant to an examination of national income.

 

 

2) Purchases of inventories by

A) firms are not counted in investment spending.

B) firms are also counted in investment spending.

C) households are also counted in investment spending.

D) households and Firms are also counted in investment spending.

E) foreign consumers are counter in investment spending.

 

 

3) In open economies

A) saving and investment are necessarily equal.

B) as in a closed economy, saving and investment are not necessarily equal.

C) saving and investment are not necessarily equal as they are in a closed economy.

D) saving and investment are necessarily equal contrary to the case of a closed economy.

E) investment always refers to the domestic stock market.

 

 

4) Investment is usually

A) more variable than consumption.

B) less variable than consumption.

C) as variable as consumption.

D) It is hard to tell from the data whether investment is more or less variable than consumption.

E) a larger component of the GNP than consumption.

 

 

5) Government purchases are defined as

A) only goods purchased by federal, state, or local governments.

B) all goods and services purchased by the federal government.

C) all goods and services purchased by the federal or state government.

D) all goods and services purchased by the federal, state, or local government.

E) goods and services purchased from the government.

 

6) Government transfer payments like social security and unemployment benefits are

A) included in government purchases.

B) not included in government purchases.

C) not included in government purchases, but they are included in the consumption component of GNP.

D) not included in government purchases, but they are part of the investment component of GNP.

E) included in government purchases but not in the GNP.

 

 

7) In 1929, government purchases accounted for

A) only 18.5 percent of U.S. GNP.

B) only 8.5 percent of U.S. GNP.

C) 28.5 percent of U.S. GNP.

D) 38.5 percent of U.S. GNP.

E) 48.5 percent of U.S. GNP.

 

 

8) Which one of the following expressions is the MOST accurate?

A) CA = EX – IM

B) CA = IM – EX

C) CA = EX = IM

D) CA = EX + IM

E) CA – IM = EX

 

 

9) A country’s current account

A) balance equals the change in its net foreign wealth.

B) balance equals the change in its foreign wealth.

C) surplus equals the change in its foreign wealth.

D) deficit equals the change in its foreign wealth.

E) balance equals its GNP.

 

 

10) The CA is equal to

A) Y – (C – I + G).

B) Y + (C + I + G).

C) Y – (C + I + G).

D) Y – (C + I – G).

E) Y + (C – I – G).