12 0f 25 Which of the following is a signicant weakness of gross domestic product (GDP) as a measure of the nation's economic performance? 0 GDP excludes the secondhand good market because it is impossible to obtain an estimate of the amount sold. 0 GDP excludes the value ofthe buying and selling of securities. 0 GDP considers product and factor markets but not services. 0 GDP excludes nonmarket production, such as black market activities. 13 of 25 A rightward shift in the aggregate demand (AD) curve indicates O a decrease in aggregate demand (AD). 0 an increase in producers' supply. 0 a decrease in inventories. 0 one or more of the components, C + l + G + (X M), increased. 14 of 25 When calculating GDP, which of the following would be included? 0 Sales revenue received from a yard sale 0 Cash income received by a selfemployed landscaper that is not reported to the IRS O A crisp $50 bill received on your birthday 0 The university tuition paid to enroll in a course 15 of 25 The difference between nominal GDP and real GDP is O nominal GDP measures actual productivity. 0 nominal GDP adjusts for ination. 0 real GDP adjusts for ination. 0 real GDP excludes imports and exports. 16 of 25 Higher prices for inputs that are widely used across the entire economy can have a macroeconomic impact on aggregate supply. Examples of widely used inputs do NOT include O cost of energy products. O cost of labor. O cost of imported goods used for inputs. O cost of orange juice. 17 of 25 When looking at Say's law, which of the following is true? O The focus is on the short run. O Every sale represents income. It is demand driven. O Supply creates its own supply. 18 of 25 You buy a new Ford F150. The tires that come with the truck are O final goods. O intermediate goods. O transfer goods. O financial goods. 19 of 25 Keynes' law advocates an increase in taxes in order to O fight inflation. O increase consumer spending. O shift aggregate demand (A O to the right. D) decrease government spending.20 of 25 In the long run, the most important factor shifting the aggregate supply (AS) curve is O aggregate demand (AD). 0 a change in consumer condence. 0 productivity growth. 0 ination. 21 of 25 When imports exceed exports, as has been the case in the United States in recent years, then exists. 0 a trade surplus O a trade decit O a trade imbalance O trade disequilibrium 22 of 25 The foreign exchange rate is 0 an adjustment that takes into account differences in the true cost of living across countries. 0 the price of one currency in terms of another. 0 another name for purchasing power parity. 0 part of the circular ow diagram. 23 of 25 If calculating GDP by the expenditure approach, the Investment (I) portion includes 0 the amount spent on new factories and machinery. O the amount spent on stocks and bonds. 0 the amount spent on consumer goods that last more than one year. 0 the amount spent on household groceries. G A When there is a shift in the aggregate demand (AD) curve in the Keynesian zone of the aggregate supply curve (AS), the following will occur: 0 There will be significant change in price. 0 There will be a supply shock. Q There will be minimal change in price. 0 There will be a neoclassical shift. 9 of 25 In order to determine if an increase in GDP is caused by an increase in quantities produced or by an increase in price (inflation), economists use 0 the cost effect GD P. O the nominal value of GDP. 0 the real value of GDP. 0 the price deator. 1D 0f25 is a subcategory of business investment that refers to the goods produced by one business that have yet to be sold to consumers, and are either still sitting in warehouses or on store shelves. 0 Services 0 Structures 0 Inventories O Durable goods 11 0f 25 Gross Domestic Product (GDP) was created during the Great Depression, by Simon Kuznets, as a way to 0 determine what caused the Great Depression. 0 measure the size of the economy. 0 show where President Franklin D. Roosevelt failed. 0 understand why the standard of living in the United States was less than that of Europe. v