Question :
11) The table gives data for a nation. The value : 1228238
11) The table gives data for a nation. The value of the country’s net exports of goods and services shows that the country’s
A) value of its exports exceeded the value of its imports.
B) value of its imports are negative.
C) net exports of goods and services are decreasing.
D) value of its imports exceeded the value of its exports.
E) value of its imports must equal zero.
12) The value of used goods ________ counted as part of GDP ________.
A) are; as long as they are classified as consumption goods
B) are; as long as they are classified as investment goods
C) are not; because they were counted during the period when they were counted as new goods
D) are not; because most fall in value and would cause a decrease in the value of GDP
E) may be; as long as their value has risen
13) If the purchase of used goods was to be incorporated into measuring GDP using the expenditure approach, then
A) we also will have to account for spending on financial assets.
B) it will be very difficult to assign a fair market value to a used good.
C) we will be counting the value of the used goods both at the time of their production and at the time of their re-sale.
D) we will have to account for the natural depreciation that a used good experiences.
E) consumption spending would need to be adjusted for depreciation.
14) When calculating GDP, purchases of used goods are
A) included at the original price.
B) included by taking the original price and subtracting the (current) used price.
C) included at the (current) used price.
D) not included.
E) included at the original price minus any depreciation.
15) If you buy a five-year-old TV from a friend, the amount you paid for the TV is
A) always added to consumption expenditures but not investment.
B) always added to investment but not consumption.
C) not included in this year’s GDP.
D) added to investment if the TV is expected to last more than 5 additional years and added to consumption if the TV is expected to last less than 5 additional years.
E) included in this year’s GDP only if the TV set was manufactured in the United States.
16) When Jamie purchases a classic 1968 Plymouth Cuda convertible from Shane, GDP
A) does not change, because the car was not produced this year.
B) increases, because the car is a durable good and increases consumption.
C) increases, because the car is a durable good and increases investment.
D) does not change, because Jamie did not buy the car from a dealership.
E) increases, because this expenditure decreases saving.
17) Spending on financial assets ________ counted as part of GDP ________.
A) are; because the cash exchanged represents an expenditure
B) are not; because their purchase is not spending on goods or services
C) are; as long as their purchase produces income
D) are not; because interest must be paid on them
E) may be; as long as their value increases
18) The purchase of 500 shares of Honda stock by the California State Employees’ Pension fund
A) is counted as consumption expenditure.
B) is not counted as part of GDP.
C) is counted as investment in the GDP accounts.
D) is counted as part of export expenditure in the GDP accounts because Honda is a foreign firm.
E) is counted as part of import expenditure in the GDP accounts because Honda is a foreign firm.
19) Recently, the government made adjustments to how GDP is calculated that included placing software purchases into the category of
A) intermediate goods because software is not a final good.
B) inventory and now software purchases are not directly counted as part of GDP.
C) investment and now directly counts software purchases as part of GDP.
D) net exports of goods and services because most software is written abroad.
E) net operating surplus.
20) Which of the following is true regarding the measurement of GDP?
A) Wages and profit income are used in the income approach to GDP.
B) Wages and consumption are used in the expenditure approach to GDP.
C) Consumption and investment are used in the income approach to GDP.
D) Government expenditure is only counted in the income approach to GDP.
E) Investment and wages are expenditures , and are therefore are used in the expenditure approach to GDP.
