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Suppose a jar of orange marmalade that is ultimately sold to a customer at The Corner Store is produced by the following production process:

Name of the company Revenues Cost of Purchase inputs  
Citrus Growers Inc .75 0  
Florida Jam Company 2 .75  
The Corner Store 2.50 2  

6. What is the value-added of Citrus Growers Inc.?

A. $0.00
B. $0.50
C. $0.75
D. $1.25

7. What is the sum of the value-added of all the firms?
A. $2.00
B. $2.50
C. $2.75
D. $4.50

8. If the oranges were grown and the jam produced in the year 2015, but the marmalade was sold at The Corner Store in the year 2016, what is the contribution of these transactions to GDP in the year 2015?
A. $0.00
B. $0.75
C. $2.00
D. $2.50

9. Comparisons of economic activity over time should be made using:

A. nominal GDP adjusted for unemployment.

B. nominal GDP per capita.

C. current-dollar GDP.

D. real GDP.

10. In the base year, real GDP ______ nominal GDP.

A. is greater than

B. is less than

C. is equal to

D. could be greater than or less than

5. In the year, 2015 Janice Quinn sells a five-year-old car to Used Car, Inc. for $3,000. In the same year, Used Car, Inc. resells the car to Ima Goner for $3,500. What is the contribution of this transaction to GDP in the year 2015?
A. $0
B. $500
C. $3,000
D. $6,500

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28 Sep 2019

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Related questions

1. Which of the following transactions would add to the value of the U.S. GDP?

A. A college student buys a used car.
B. A college student sells her used textbooks back to the bookstore.
C. A grocery store purchases new freezers made in the United States.

D. U.S. citizen buys a new television manufactured in Asia.

2. The growth rate of real GDP:
A. depends on which year is used as the base year.
B. depends on how quickly prices are rising.
C. is always equal to the rate of growth of nominal GDP. D. is always more than the rate of growth of nominal GDP.

3. Which statement is true about GDP?
A. GDP includes the values of all final and intermediate goods and services.
B. Only the products made by American workers are included in the calculation of the US GDP.

C. Sales of old houses and used cars are included in the calculation of GDP for the current year.

D. In the US, GDP is calculated both annually and quarterly.

4. Which statement is true about GDP growth?
A. The GDP deflator is a measure of economic growth.
B. If we want to compare GDP over time, we should always compare real GDP.
C. Most economists choose nominal GDP growth as a single indicator of economic performance.

D. The GDP deflator tells the quantity change of production.

5. Which of the following is a way to compute GDP?

A. add up the wages paid to all workers

B. add up the quantities of all final goods and services
C. add up the market value of all final goods and services

D. add up the rents paid by all tenants

6. A farmer produces oranges and sells them to Fresh Juice, which makes orange juice. The oranges produced by the farmer are called:
A. inventory goods
B. transitory goods

C. final goods
D. intermediate goods

7. Martin, a US citizen, travels to Mexico and buys a newly manufactured motorcycle there. His purchase is included in:

A. both Mexican GDP and US GDP.

B. Mexican GDP, but not in US GDP.

C. US GDP, but not in Mexican GDP.

D. neither Mexican GDP nor US GDP.

8. Which of the following is included in Singapore GDP?

A. The value of production by a Singaporean working in the US.
B. The value of production by an American working in Singapore.
C. The value of production by a Singaporean that crosses the order to work in Malaysia.

D. All of the above are correct.

9. In the equation Y = C + I + G + NX,
A. Y represents the economy's total expenditure.

B. C represents household on durable goods.
C. all of the variables are always positive numbers.

D. All of the above are correct.

10. Consumption consists of spending by households on goods and services, except

purchases of intangible services.

purchases of durable goods.

purchases of new houses.

spending on education.

11. Which of the following is included in government purchase?

A. unemployment benefits a state government pays

B. social security payments the US government makes
C. the services of a US government attorney valued at the cost of her salary

D. All of the above are correct.

12. Transfer payments are:

A. included in GDP because they represent income to individuals.
B. included in GDP because they eventually will be spent on consumption.
C. not included in GDP because they are not payments for currently produced goods or services.

D. not included in GDP because taxes will have to be raised to pay for them.

13. Net exports equal
A. exports plus imports

B. exports minus imports

C. imports minus exports

D.GDP minus imports

14. In the economy of TAMIU in 2015, exports were $200, GDP was $2000, government purchases were $200, imports were $270, and investment was $500. What was TAMIU's consumption in 2015?

A. $830

B. $1230

C. $1370

D. $1770

15. Nominal GDP will increase when

A. prices increase and output increases.
B. prices increase and output decreases.
C. prices decrease and output increases.

D. All of the above are correct.

16. Changes in real GDP reflect:

A. only changes in prices.

B. only changes in the amounts being produced.
C. both changes in prices and changes in the amounts being produced.

D. neither changes in prices nor changes in the amounts being produced.

17. Which of the following is correct?
A. Nominal GDP is always less than real GDP.

B. Nominal GDP is always greater than real GDP.
C. Nominal GDP equals real GDP in the base year.
D. Nominal GDP equals real GDP in all years but the base year.

18. The GDP deflator is the ratio of:

A. real GDP to nominal GDP.

B. real GDP to the inflation rate.
C. real GDP to nominal GDP.
D. nominal GDP to the inflation rate.

19. In 2012 the nominal GDP was $18 billion and the GDP deflator was 120, what was real GDP?
A. $6.7 billion
B. $10 billion

C. $40 billion D. $100 billion

20. In the base year, the GDP deflator is always equal to A. -1
B. 0
C. 2

D. 1

21. GDP does not reflect:

A. the value of leisure.

B. the value of goods and services produced at home.

C. the quality of the environment.
D. All of the above are correct.

22. When economists talk about growth in the economy, they measure that growth as the:

A. absolute change in nominal GDP from one period to another.

B. percentage change in nominal GDP from one period to another.

C. absolute change in real GDP from one period to another.
D. percentage change in real GDP from one period to another.

23. The term economists use to describe a situation in which the economy’s overall price level is rising is:

A. economic growth

B. inflation
C. recession
D. business cycles

Use information from the Bureau of Economic Analysis (BEA) website, http://www.bea.gov/, answer question 24 and 25.

24. What is the real GDP growth rate in the 4th quarter of 2015 for the United States?

A. 1%
B. 2%
C. 3%

D. 4%

25. What is the value of real GDP in 1998 for the United States?

A. $11525.9 billion

B. $9089.2 billion

C. $11321.2 billion

D. $8889.7 billion

Ryan saved​ $50,000 last year in his bank account so that he could buy a car this year. In this​ case, money served the function of a​ ________.

A.

means of deferred payment

B.

unit of account

C.

store of value

D.

medium of exchange

A bank is said to have enough liquidity​ if:

A.

it holds deposits amounting to at least​ $100,000.

B.

it operates for seven days a week for more than 12 hours a day.

C.

it has enough funds to conduct its

dayminus−tominus−day

businesses and meet the regulatory requirements.

D.

the value of its assets exceeds the value of its liabilities by at least​ $50,000.

Consider an economy that only produces wooden chairs. In​ 2012, the economy produced 100 wooden chairs priced at​ $10 each. The nominal GDP of the economy for the year 2012 will​ be:

A.

​$10,000.

B.

​$10.

C.

​$100.

D.

​$1,000.

Hyperinflationary episodes are always related to extremely rapid growth​ of:

A.

real GDP.

B.

money supply.

C.

interest rates.

D.

money demand.

Which of the following financial organizations have the ability to influence the supply of reserves in the United​ States?

A.

The World Bank

B.

The Fed

C.

Only private commercial banks

D.

Only public sector banks

A retired worker receives a pension that is not indexed to inflation. Which of the following will happen if the rate of inflation​ rises?

A.

The retiree will be better off.

B.

The​ retiree's purchasing power will fall.

C.

The shareholders of the firm in which he worked will lose.

D.

The​ retiree's purchasing power will increase.

Assuming all else​ equal, what is likely to happen to the demand curve for reserves in an economy if it goes through a period of rapid​ expansion?

A.

There will be a n upward movement along the demand curve for reserves.

B.

The demand curve for reserves will shift to the left.

C.

There will be a downward movement along the demand curve for reserves.

D.

The demand curve for reserves will shift to the right.

If the nominal interest rate in an economy is​ 9% and the expected inflation rate is​ 6%, then the expected real interest rate in the economy​ is:

A.

​15%.

B.

​9%.

C.

​6%.

D.

​3%.

If nominal GDP​ increases, what might be the cause of this​ increase?

If nominal GDP​ increases, this could be caused​ by:

​(Select

all that

apply.​)

A.

An increase in the price level

B.

Deflation

C.

An increase in real GDP

D.

A decrease in the price level

Given the following​ information, what is the growth rate of nominal​ GDP?

Upper Y 0Y0

real GDP​ =

​$10001000

​(in millions)

Upper Y 1Y1

real GDP​ =

​$11001100

​(in millions)

Upper Y 0Y0

price level​ = 120120

Upper Y 1Y1

price level​ = 130130The growth rate of nominal GDP is

nothing ​%.

​ (Round

your answer to the nearest

hundredth.​)

According to the quantity theory of​ money, what must the growth rate of the money supply be given the following​ information?

The growth rate of real GDP is

1.01.0​%.

The growth rate of nominal GDP is

3.83.8​%.

The nominal interest rate is

7.17.1​%.

The real interest rate is

4.34.3​%.

The money supply​ (M2) is

​$10 comma 61210,612

​(in billions)According to the quantity theory of​ money, the growth rate of the money supply must be

nothing ​%.

​ (Round

your answer to the nearest

tenth.​)

According to the quantity theory of​ money, what is the inflation​ rate?

Use the information given above and calculate the inflation rate.

According to the quantity theory of​ money, the inflation rate is

nothing ​%.

​ (Round

your answer to the nearest

tenth.​)

According to the quantity theory of​ money, the inflation rate is

A.

the ratio of money supply to nominal GDP.

B.

the gap between the growth rate of money supply and the growth rate of real GDP.

C.

the gap between the nominal and real interest rates.

D.

the gap between the growth rate of money supply and the growth rate of nominal GDP.

If the inflation rate is

positivepositive​,

what must be​ true?

A.

The growth rate of nominal GDP

greater than>

the growth rate of money supply.

B.

The growth rate of real GDP

less than<

the growth rate of money supply.

C.

The growth rate of real GDP

greater than>

the growth rate of money supply.

D.

The growth rate of nominal GDP

less than<

the growth rate of money supply.

An open market operation is​ ____________.

A.

the process of selling​ Fed-issued IOUs between banks.

B.

an exchange between a private bank and the Federal Reserve where the Fed buys or sells government bonds to private banks.

C.

where a bank borrows reserves or bonds from the Federal​ Reserve's discount window.

D.

an exchange between private banks where the banks buy or sell bonds to each other.

The Federal Reserve conducts open market operations when it wants to​ ____________.

A.

change the liquidity levels of banks.

B.

influence the discount rate.

C.

influence the federal funds rate.

D.

change the level of reserves it holds for banks.

When the Fed

sellssells

government bonds

toto

private​ banks, it

▼

the electronic reserves that banks hold.

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