2/23/24, 4:44 PM
Quiz: Chapter 27 Quiz
Chapter 27 Quiz
Started: Feb 23 at 4:14pm
Quiz Instructions
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Question 1 1 pts
Value added can be determined by
subtracting the purchase of intermediate products from the value of the sales of final products.
deflating nominal GDP.
calculating the year-to-year changes in real GDP.
summing the profits of all enterprises in the economy.
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Question 2 1 pts
Personal Consumption Expenditures
Government Purchases
Gross Private Domestic Investment
$ 400
128
88
Net Exports
7
Net Foreign Factor Income
0
Consumption of Fixed Capital
43
Taxes on Production and Imports
50
Compensation of Employees
369
Rents
12
Interest
15
Proprietors' Income
52
Corporate Income Taxes
36
Dividends
24
Undistributed Corporate Profits
22
Statistical Discrepancy
0
Refer to the accompanying national income data for the economy. All figures are in billions of dollars.
The gross domestic product for this economy is
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Quiz: Chapter 27 Quiz
$623.
$584.
$592.
$609.
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Question 3 1 pts
Year
Units of
Output
Price Per
Unit
1
3
$ 3
2
4
4
3
6
5
4
7
7
5
8
8
Assume an economy makes only one product and that Year 3 is the base Year. Output and price data for
a five-year period are shown in the table. The nominal GDP for Year 4 is
$40.
$55.
$35.
$49.
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Question 4 1 pts
Year
Units of Output
Price of Bagel
per Unit
1
16
$ 16
2
18
26
162.5
3
21
36
225
4
26
46
287.5
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Price Index
(Year 1 = 100)
100
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Quiz: Chapter 27 Quiz
The table contains data for a hypothetical single-product economy. Nominal GDP in Year 4 is
$320.
$450.
$225.
$1,196.
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Question 5 1 pts
Which of the following best defines national income?
the market value of the annual output net of consumption of fixed capital
the before-tax income received by households
incomes earned by U.S. resource suppliers plus taxes on production and imports
income received by households less personal taxes
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Question 6 1 pts
The total amount of income earned by U.S. resource suppliers in a year, plus taxes on production and
imports, is measured by
gross domestic product.
personal income.
disposable income.
national income.
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Question 7 1 pts
If the economy adds to its inventory of goods during some year,
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Quiz: Chapter 27 Quiz
this amount should be included in calculating that year's GDP.
gross investment will exceed net investment by the amount of the inventory increase.
this amount should be ignored in calculating that year's GDP.
this amount should be subtracted in calculating that year's GDP.
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Question 8 1 pts
When an economy's production capacity is expanding,
gross domestic investment exceeds depreciation.
net exports is always a positive amount.
nominal GDP, but not necessarily real GDP, is rising.
DI exceeds PI.
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Question 9 1 pts
Suppose that GDP was $280 billion in Year 1 and that all other components of expenditures remained
the same in Year 2 except that business inventories fell by $18 billion. GDP in Year 2 is
$280billion.
$180 billion.
$262 billion.
$210 billion.
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Question 10 1 pts
The value added of a firm is the market value of
the firm's output.
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Quiz: Chapter 27 Quiz
the firm's inputs bought from others.
a firm's output plus the value of the inputs bought from others.
a firm's output less the value of the inputs bought from others.
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Question 11 1 pts
Proprietors' Income
$ 45
Compensation of Employees
325
Consumption of Fixed Capital
Gross Investment
40
105
Rents
35
Interest
45
Exports
55
Imports
75
Corporate Profits
50
Taxes on Production and Imports
30
Net Foreign Factor Income
0
Statistical Discrepancy
0
Refer to the accompanying data. All figures are in billions of dollars. Net domestic product is
$530.
$375.
$395.
$360.
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Question 12 1 pts
Units of
Price Per
Year
Output
Unit
1
3
$ 3
2
4
4
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Quiz: Chapter 27 Quiz
Units of
Price Per
Year
Output
Unit
3
6
5
4
7
7
5
8
8
Assume an economy that only one product and that Year 3 is the base year. Output and price data for a
5-year period are shown in the table. In determining real GDP, the nominal GDP for
Years 1 and 2 must be inflated.
each year must be multiplied by the relevant price index.
Years 4 and 5 must be inflated.
Years 1 and 2 must be deflated.
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Question 13 1 pts
The income approach to national income accounting lists "Rents" as one of the components. All of the
following statements about "rents" are correct except
rents include monthly payments tenants make to landlords.
rents include the interest paid to the suppliers of loans used to purchase capital.
rents include gross rental income minus depreciation of the rental property.
rents include lease payments corporations pay for the use of office space.
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Question 14 1 pts
Alejandro owns a store specializing in soccer jerseys. One year, he purchased $150,000 worth of jerseys
from manufacturers and later that year, sold the jerseys for $280,000. Based on this information, what
was the value added at Alejandro's store?
$150,000
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Quiz: Chapter 27 Quiz
$40,000
$130,000
$280,000
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Question 15 1 pts
Gross Investment
$ 23
National Income
105
Net Exports
Personal Income
7
90
Personal Consumption
Expenditures
75
Saving
10
Government Purchases
25
Net Domestic Product
110
Statistical Discrepancy
0
Refer to the accompanying data (all figures in billions of dollars). Disposable income is
$83.
$85.
$73.
$77.
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Question 16 1 pts
Proprietors' Income
Compensation of Employees
$ 20
300
Consumption of Fixed Capital
15
Gross Investment
80
Rents
10
Interest
20
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Exports
30
Imports
50
Corporate Profits
25
Taxes on Production and Imports
5
Net Foreign Factor Income
0
Statistical Discrepancy
0
Refer to the accompanying data. All figures are in billions of dollars. Gross domestic product is
$395.
$375.
$380.
$360.
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Question 17 1 pts
Gross Private Domestic
Investment
National Income
Net Exports
$ 18
100
2
Personal Income
85
Personal Consumption
Expenditures
70
Saving
5
Government Purchases
20
Net Domestic Product
105
Statistical Discrepancy
0
Refer to the accompanying data (all figures in billions of dollars). The gross domestic product for this
economy is
$107.
$100.
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Quiz: Chapter 27 Quiz
$110.
$95.
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Question 18 1 pts
Personal Consumption Expenditures
Government Purchases
Gross Private Domestic Investment
$ 400
128
88
Net Exports
7
Net Foreign Factor Income
0
Consumption of Fixed Capital
43
Taxes on Production and Imports
50
Compensation of Employees
369
Rents
12
Interest
15
Proprietors' Income
52
Corporate Income Taxes
36
Dividends
24
Undistributed Corporate Profits
22
Statistical Discrepancy
0
Refer to the accompanying national income data for the economy. All figures are in billions of dollars. Net
domestic product is
$623.
$580.
$573.
$520.
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Question 19 1 pts
Suppose that inventories were $80 billion in Year 1 and $70 billion in Year 2. For Year 2, national income
accountants would
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Quiz: Chapter 27 Quiz
subtract $75 billion (= $150 ÷ 2) from other items of investment in calculating total investment.
subtract $10 billion from other items of investment in calculating total investment.
add $10 billion to other items of investment in calculating total investment.
add $75 billion (= $150 ÷ 2) to other items of investment in calculating total investment.
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Question 20 1 pts
Personal Taxes
$ 40
Social Security Contributions
15
Taxes on Production and Imports
20
Corporate Income Taxes
40
Transfer Payments
22
U.S. Exports
24
Undistributed Corporate Profits
35
Government Purchases
90
Gross Private Domestic Investment
75
U.S. Imports
22
Personal Consumption Expenditures
250
Consumption of Fixed Capital
(depreciation)
25
Net Foreign Factor Income
10
Statistical Discrepancy
0
Refer to the accompanying data (all figures in billions of dollars). PI is
$314.
$346.
$408.
$437.
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