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Exam 10: Measuring a Nations Income

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Question 81

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Retained earnings is income that

A) households retain after paying taxes.
B) businesses retain after paying taxes.
C) corporations have earned but have not used to invest in plant, equipment, and inventories.
D) corporations have earned but have not paid out to their owners.

E) C) and D)
F) None of the above

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Question 82

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Which of the following is not correct?

A) GNP equals net national product plus losses from depreciation.
B) For most countries, including the United States, GDP and GNP are nearly the same.
C) GDP and GNP typically move in opposite directions.
D) Personal income equals disposable personal income plus personal taxes plus certain nontax payments.

E) B) and C)
F) None of the above

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Question 83

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In the economy of Ukzten in 2010, consumption was $1000, GDP was $1950, government purchases were $500, and investment was $700. What were Ukzten's net exports in 2010?

Which of the following transactions adds to U.S. GDP for 2010?

A form of government spending that is not made in exchange for a currently produced good or service is called

Household spending on education is counted in which component or subcomponent of GDP?

In the economy of Ukzten in 2010, consumption was $2000, exports were $800, GDP was $4800, government purchases were $840, and investment was $1400. What were Ukzten's imports in 2010?

An American retailer purchased 100 pairs of shoes from a company in Denmark in the second quarter of 2010 but does not sell them to a consumer until the third quarter of 2010. In which quarter(s) is (are) the value of the shoes included in U.S. GDP?

Whip-It manufactures blenders. In 2009 it had $50,000 of blenders in inventory. In 2010 it sold $300,000 of blenders to consumers and had $40,000 of blenders in inventory. How much did blenders produced by Whip-it add to GDP in 2010?

Suppose the government passes a law eliminating holidays and, as a result, the production of goods and services increases because people work more days per year (and thus enjoy less leisure per year) . Based on this scenario, which of the following statements is correct?

Which of the following items is included in U.S. GDP?

In the economy of Ukzten in 2010, consumption was $500, exports were $200, GDP was $1200, government purchases were $250, and investment was $300. What were Ukzten's imports in 2010?

Other things equal, in countries with higher levels of real GDP per person, life expectancy and literacy rates are higher than in countries with lower levels of real GDP per person.

A U.S. firm produces sweatshirts in the first quarter of 2010 and adds them to its inventory. In the second quarter of 2010 the firm sells the sweatshirts to consumers. In which quarter(s) does(do) these transactions raise consumption?

If nominal GDP is $8 trillion and real GDP is $10 trillion, then the GDP deflator is

The GDP deflator can be used to take inflation out of nominal GDP.

A Texas household receives a Social Security check for $500, which it uses to purchase a $460 television made in Korea by a Korean firm and a $40 dinner at a local restaurant. As a result, U.S. GDP

If in some year real GDP was $5 trillion and the GDP deflator was 200, what was nominal GDP?

Last year country A had a nominal GDP of $600 billion, a GDP deflator of 150 and a population of 40 million. Country B had a nominal GDP of $720 billion, a GDP deflator of 120 and a population of 50 million. From these numbers which country is likely to have had the higher standard of living?

The information for 2008 in millions in the table below was reported by the World Bank. On the basis of this information, which list below contains the correct ordering of real GDP per person from highest to lowest? $\begin{array} { | l | l | l | l | } \hline \text { Country } & \text { GDP (Constant US\$) } & \text { GDP(Current US\$) } & \text { Population } \\\hline \text { Germany } & 2,091,573 & 3,649,493 & 82.11 \\\hline \text { Japan } & 5,166,281 & 4,910,839 & 127.70 \\\hline \text { U.S. } & 11,513,872 & 14,093,309 & 304.06 \\\hline\end{array}$