Question : Table 19-27 National income                $1,000 Retained earnings n : 1388074

 

Table 19-27

 

National income

               $1,000

Retained earnings not paid as dividends

                      50

Transfer payments

                      40

Interest on government bonds

                      20

Personal taxes

                      30

 

The components of national income for an economy are represented in Table 19-27 above. All values are in billions of dollars.

 

14) Refer to Table 19-27.  What is the level of personal income for this economy?

A) $1,140 billion

B) $1,010 billion

C) $990 billion

D) $860 billion

 

 

15) Refer to Table 19-27.  What is the level of disposable personal income for this economy?

A) $1,080 billion

B) $1,010 billion

C) $980 billion

D) $860 billion

 

 

16) National income is equal to

A) personal income minus personal taxes.

B) GDP minus depreciation.

C) disposable personal income plus depreciation plus personal taxes.

D) GNP plus depreciation.

 

17) Gross national product is defined as

A) the value of final goods and services produced within the United States.

B) the value of final goods and services produced outside of the United States.

C) the value of final goods and services produced by residents of the United States even if the production takes place outside of the United States.

D) the value of final goods and services produced within the United States, by United States residents.

 

 

18) If a U.S. firm produces cars in Mexico, that production should count towards

A) U.S. GNP.

B) Mexico’s GNP.

C) U.S. GDP.

D) It will not affect either U.S. GNP or U.S. GDP.

 

 

19) If a German firm produces cars in the United States, that production should count towards

A) U.S. GNP.

B) German GDP.

C) U.S. GDP.

D) both U.S. GNP and German GDP.

 

 

20) Which of the following would increase GNP in the United States?

A) an increase in the production of U.S.-owned General Motors cars made in Mexico

B) an increase in the production of Japanese-owned Toyota cars in Mexico

C) an increase in the production of Japanese-owned Toyota cars in the U.S.

D) an increase in the production of Mexican-owned Grupo Minsa corn in the U.S.

 

21) When lumber from Brazilian forests is used by a U.S.-owned company to produce furniture in Canada, the value of the furniture produced will be counted as a final good in

A) U.S. GDP.

B) Canada’s GDP.

C) Brazil’s GDP.

D) Brazil’s GNP.

 

 

22) When Ford increases the production of cars in Australia, which of the following occurs?

A) GDP in the United States rises.

B) GNP in the United States rises.

C) GNP in Australia rises.

D) Both A and C occur.

 

 

23) National income is defined as

A) gross national product plus transfer payments.

B) gross national product less retained earnings plus transfer payments.

C) gross domestic product less retained earnings plus transfer payments.

D) gross domestic product less the consumption of fixed capital.