economics

Question 12 pts

Suppose that in Wentworth most residents supply factors of production to foreign firms, while producers in Wentworth never employ factors owned by residents of other countries. Which of the following statements is true for Wentworth?

[removed]	GDP exceeds GNP by an amount equal to depreciation plus indirect business taxes.
[removed]	GDP is greater than GNP.

[removed]	GDP and GNP are about the same.
[removed]	GDP is less than GNP.

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Question 22 pts

The purchases of U.S. products by citizens of Mexico are

[removed]	considered Mexico's exports.
[removed]	counted as U.S. imports.

[removed]	counted as U.S. exports.
[removed]	considered as an income transfer from the U.S. to Mexico.

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Question 32 pts

GDP includes __________ expenditures but does not include __________ expenditures.

[removed]	education; national defense
[removed]	national defense; transfer payment

[removed]	Social Security payments to retired persons; education
[removed]	Social Security payments to retired persons; national defense

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Question 42 pts

Suppose that in Croy, residents never supply factors of production to foreign firms, while producers in Croy regularly employ factors owned by residents of other countries. Which of the following statements is true for Croy?

[removed]	GDP is less than GNP.
[removed]	GDP and GNP are about the same.

[removed]	GDP exceeds GNP by an amount equal to depreciation plus indirect business taxes.
[removed]	GDP is greater than GNP.

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Question 52 pts

Private investment plays a crucial role in the macro economy because it is

[removed]	an expenditure that adds to the economy's productive capacity.
[removed]	the largest expenditure component of GDP.

[removed]	the smallest expenditure component of GDP.
[removed]	undertaken by the government and must be funded by tax revenue.

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Question 62 pts

Gross national product minus net factor earnings from abroad is equal to gross domestic product.

[removed]	true
[removed]	false

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Question 72 pts

Which of the following statements about gross national product is correct? It measures the market value of

[removed]	all final goods and services produced by residents and firms of a nation regardless of the location of production.
[removed]	all final goods and services produced by resources located within a nation regardless of who owns those resources.

[removed]	all goods and services, both final and intermediate, produced by residents and firms regardless of the location of production.
[removed]	all goods and services, both final and intermediate, produced by resources located within a nation regardless of who owns those resources.

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Question 82 pts

GDP increases if you purchase General Motors stock.

[removed]	true
[removed]	false

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Question 92 pts

In reality, the GDP-GDI gap

[removed]	represents a small fraction of measured activity.
[removed]	is due to different accounting standards among countries in the world.

[removed]	is due to the presence of substantial black market activity.
[removed]	represents a significant fraction of measured activity.

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Question 102 pts

The income earned by those who supply entrepreneurial talent is called

[removed]	value of stock options.
[removed]	profits.

[removed]	net interest.
[removed]	wages and salaries.

Question 12 pts

GNP equals GDP less depreciation.

[removed]	true
[removed]	false

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Question 22 pts

Gross domestic product

[removed]	could be either a flow variable or a stock variable depending on the time period considered.
[removed]	is neither a flow nor a stock variable; it is a statistic.

[removed]	is a flow variable.
[removed]	is a stock variable.

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Question 32 pts

Which of the following items is a stock variable?

I. consumption expenditure

II. gross private investment

III. a trade surplus

IV. government debt

[removed]	II, III, and IV only
[removed]	II and III only

[removed]	III and IV only
[removed]	All of the above items

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Question 42 pts

If exports are less than imports,

[removed]	net exports is a negative number.
[removed]	net exports is a positive number.

[removed]	net imports equal zero.
[removed]	net imports is a negative number.

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Question 52 pts

What is the difference between a flow variable and a stock variable?

[removed]	A flow variable is a variable that is measured in units of current prices while a stock variable is measured using prices from a base period.
[removed]	A stock variable is a variable that is measured in units of current prices while a flow variable is measured using prices from a base period.

[removed]	A flow variable is a variable that is measured over a specific period of time while a stock variable is a variable that is independent of time.
[removed]	A stock variable is a variable that is measured over a specific period of time while a flow variable is a variable that is independent of time.

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Question 62 pts

Nominal GDP uses current market prices and real GDP measures GDP using base-year prices.

[removed]	true
[removed]	false

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Question 72 pts

The value of income generated by the production of a given value of final goods and services is called

[removed]	net factor output.
[removed]	gross domestic income.

[removed]	gross personal product.
[removed]	net foreign factor income.

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Question 82 pts

In the circular flow model for an economy that produces only consumption goods,

[removed]	expenditures on output flow from firms to households.
[removed]	factor incomes flow from households to firms.

[removed]	factors of production flow from households to firms.
[removed]	factors of production flow from firms to households.

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Question 92 pts

Government purchases

[removed]	are the sum of purchases of goods and services from firms by government and the value of transfer payments made to government to its citizens.
[removed]	are the sum of purchase of final goods and service from firms by government agencies and the payment of interests on loans undertaken by the government.

[removed]	refer to the purchase of final goods and service from firms by government agencies and do not include the value of output produced by government agencies.
[removed]	are the sum of purchases of goods and services from firms by government agencies and the total value of output produced by government agencies.

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Question 102 pts

Which of the following would not be included in the measurement of GDP?

[removed]	employers' payments for employees' medical insurance
[removed]	a purchase of California wine by a Canadian firm

[removed]	transactions in the underground economy
[removed]	federal government payments for Jeeps

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