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Exam 7: Gdp and Cpi: Tracking the Macroeconomy

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Question 171

True/False

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The consumer price index is calculated by the Bureau of Labor Statistics.

A) True
B) False

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Question 172

Multiple Choice

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Wages are:

A) the income households earn by selling their labor.
B) the interest earned from bonds.
C) rent earned from the use of land to firms.
D) the indirect ownership of the physical capital used by firms.

E) C) and D)
F) All of the above

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Question 173

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If during 2010, the Republic of Sildavia recorded investment spending of $3 billion, government purchases of $3 billion, consumer spending of $7 billion, imports of $5 billion, government transfers of $1 billion, and exports of $3 billion, Sildavia's GDP in 2010 was:

Explain why each of the following transactions would or would not be counted in the GDP of the United States. a. Japanese auto producer Honda builds a factory in Indiana. b. You buy a new pair of pants produced at a factory in Honduras. c. You mow your uncle's yard and he gives you $10 for a job well done.

Purchases of foreign-produced goods and services are:

Use the following to answer questions: Table: Real and Nominal Output -(Table: Real and Nominal Output) Look at the table Real and Nominal Output. The change in real output between years 3 and 4 is an increase of:

Use the following to answer questions : -(Table: Market Basket of School Supplies) Look at the table market Basket of School Supplies. It shows the prices of three common school supplies in 2010 and 2011 and the quantities of each school supply that consumers bought in 2010, the base year. A school supply index for 2011 would be:

Use the following to answer questions: Table: Real and Nominal Output -(Table: Real and Nominal Output) Look at the table Real and Nominal Output. In which year is all of the increase in nominal output due to an increase in real output?

Renting a car to go on a vacation will result in more GDP than if you used your own car.

The purpose of indexing Social Security payments to the consumer price index is to:

The price index in the current year is the cost of the market basket in the current year divided by the cost of the market basket in the base year.

In the factor markets:

If the cost of a market basket is $150 in year 1 and $200 in year 2, the price index for year 1 using year 2 as the base is:

In the circular-flow diagram, firms:

Households receive income in the form of all of the following EXCEPT:

Use the following to answer questions : -(Table: Peanut Butter and Jelly Economy) Look at the table Peanut Butter and Jelly Economy. Nominal GDP in 2010 was:

Use the following to answer questions : Table: Pizza Economy III -(Table: Pizza Economy III) Look at the table Pizza Economy III. Considering 2010 as the base year, real GDP in 2011 was:

A household is a person or group of people who share an income.

Included in GDP is the dollar value of:

The GDP deflator for a given year is equal to 100 times nominal GDP for that year divided by real GDP for that year expressed in prices of a selected base year.