Question

QUESTION 1 Suppose that in 2013, the total value of all final services produced in a nation was $300 billion; the total value of all final goods produced in that nation was $400 billion; and the total value of all final goods and services produced by that nation's firms in other countries was $200 billion. Gross domestic product was $700 billion. $500 billion. $600 billion. $900 billion. 0.41999 points QUESTION 2 If nominal Gross Domestic Product (GDP) in 2005 was $500 billion with a price index of 100, what would be the real Gross Domestic Product (GDP) in 2013 if the 2013 nominal Gross Domestic Product (GDP) was $900 billion and the 2013 price index was 140? $643 billion $900 billion $540 billion $800 billion 0.41999 points QUESTION 3 Nominal income per person in the United States in 1960 was about $2,800 per year, while in 1990 nominal income per person was about $21,000. This indicates that a dollar in 1960 was worth less than a dollar in 1990. people enjoyed a standard of living about 7.5 times higher in 1990 than in 1960. the average person would consider him/herself about 7.5 times happier in 1990 than in 1960. nominal income was about 7.5 times greater in 1990, but we can't tell if this increase is due to inflation, economic growth, or a combination of the two. 0.41999 points QUESTION 4 An example of a nondurable good is items purchased at a grocery store. the services of a cleaning person. a refrigerator. the purchase of labor for a business. 0.41999 points QUESTION 5 Your parents surprise you with a $500 check. As a result, the U.S. GDP decreases because you will spend it on useless goods. increases because this is unexpected income to you. remains unchanged because it was counted when your parents earned it. decreases because you have to pay taxes on this income. 0.41999 points QUESTION 6 GDP does NOT measure the well-being of a nation's residents because it excludes the value of intermediate goods. includes the value of final goods and services produced in the economy. excludes the sale of secondhand goods. excludes nonmarket transactions. 0.41999 points QUESTION 7 Mental or physical labor or help purchased by consumers is a(n) nondurable consumer good. durable consumer good. investment. service. 0.41999 points QUESTION 8 The values of variables such as GDP expressed in current dollars are referred to as real values. the price index. a deflator. nominal values. 0.41999 points QUESTION 9 The total factor payments to all resource owners is called national income. personal income. net domestic product. gross domestic income. 0.41999 points QUESTION 10 In the product market, consumers trade resources for goods and services. businesses trade goods and services for resources. consumers trade goods and services for resources. consumers trade monetary payments for goods and services. 0.41999 points QUESTION 11 (amounts in billions of dollars) According to the above table, Gross Domestic Product as calculated by the expenditure approach is $13,384 billion. $13,617 billion. $14,337 billion. $13,278 billion. 0.41999 points QUESTION 12 Goods used up entirely in the production of final goods are production goods. intermediate goods. process goods. inventory goods. 0.41999 points QUESTION 13 Refer to the above table. The production of this good goes through 4 different stages of production. What is the total dollar value added when production is completed? $0.75 $0.07 $0.32 Cannot be computed without more information. 0.41999 points QUESTION 14 Calculating Gross Domestic Product (GDP) by the income approach would require including all transfer payments by the government. all wages paid. the market value of all final goods and any profits. all restaurant sales. 0.41999 points QUESTION 15 (amounts in billions of dollars) According to the above table, national income is $11,968 billion. $11,943 billion. $11,866 billion. $12,637 billion.

Answer 1

QUESTION 1. Suppose that in 2013, the total value of all final services produced in a nation was $300 billion;

the total value of all final goods produced in that nation was $400 billion;

and the total value of all final goods and services produced by that nation's firms in other countries was $200 billion.

Gross domestic product was $700 billion.

GDP (Gross domestic product is the sum total of final values of all gods and services produced in a country in a year.

Formula to calculate GDP by expenditure method is : C+I+G+(X-M)

Where, C= Consumption expenditure, I= Investment expenditure, G= Govt. expenditure, (X= Export and M=Import)

As it is a gross domestic product it will not consider final goods and services produced by that nation's firms in other countries. It will however be considered in national income.

QUESTION 2 If nominal Gross Domestic Product (GDP) in 2005 was $500 billion with a price index of 100, what would be the real Gross Domestic Product (GDP) in 2013 if the 2013 nominal Gross Domestic Product (GDP) was $900 billion and the 2013 price index was 140?

Deflator: (Nominal GDP/Real GDP)*100

in 2013, nominal gdp = 900 billion $and deflator = 140, real GDP = (900/140)*100= 643 Billion $

QUESTION 3 .Nominal income per person in the United States in 1960 was about $2,800 per year, while in 1990 nominal income per person was about $21,000. This indicates that a dollar in 1960 was worth less than a dollar in 1990. people enjoyed a standard of living about 7.5 times higher in 1990 than in 1960. the average person would consider him/herself about 7.5 times happier in 1990 than in 1960. nominal income was about 7.5 times greater in 1990, but we can't tell if this increase is due to inflation, economic growth, or a combination of the two.

It is true. It is not given what is price change during this time from 1960 to 1990. Nominal GDP is not adjusted for change in prices and hence may give illusionary numbers.

QUESTION 4 An example of a non durable good is items purchased at a grocery store. the services of a cleaning person. a refrigerator. the purchase of labor for a business.

Durable is long lasting: Hence, items purchased at a grocery store. is correct answer. rest all are long lasting. Labors are not goods.