27. Use the following to answer question 10

Refer to the table above. What is the economy's GDP?

A) $6.5 trillion B) $6.6 trillion C)$6.9 trillion D) $7.3 trillion

28.The expenditure (demand) approach to measuring GDP:

A) focuses on how income is spent, not earned.

B) uses the factors payments made by households to businesses to estimate GDP.

C) uses household expenditures to back out national income and GDP.

D)uses of the factor payments made by household to government

29. If in some country personal consumption expenditures in a specific year are $50 billion, purchases of stocks and bonds are $30 billion, net exports are -$10 billion, government purchases are $20 billion, sales of secondhand are $8 billion, and gross investment is $25 billion, what is the country GDP for that year?

A) $125 billion B) $85 billion C) $133 billion D) $123 billion

30. Assume that the total value of the following items is $600 billion in a specific year for Upper Mongoose: Net exports= $50 billion; value of net goods and services produced in underground economy= $75 billion; personal consumption expenditures = $300 billion; value of the services stay-at-home parents= $25 billion; gross domestic investment= $100 billion; government purchases = $50 billion. The Upper Mongoose GDP for the year is _______________, and the size of underground economy ____________ percentage of GDP?

A) $600 billion; 12.5% B) $500 billion; 15%

C) $475 billion; 17% D)525 billion; 14%

31. The economy GDP in the short-run depends on_______________

A) quantity of resources B) quality of resources

C) total spending D) new technology and productivity.

32. If U.S. imports of goods and services exceed exports:

A) U.S. GDP is less than the sum of consumption, investment, and government purchases.

B) U.S. GDP exceeds the sum of consumption, investment, and government purchases.

C) U.S. net exports are positive.

D) U.S. GDP equals the sum of consumption, investment and government purchases.

33. Investment, as defined by economists, would not include which of the following? General

Motors

a. buys a new robotic machine

b. adds 1000 new cars to inventories

c. builds another assembly plant

d. buys U.S government bonds

34. __________ is best defined as the value of all final goods and services in terms of prices in the current year.

A) nominal GDP. B) real GDP. C) potential GDP. D)actual GDP.

35. Which of the following equals the market value of all final goods and services produced in an economy, stated in the prices of a given base year?

A) Nominal GNP. B) Nominal GDP. C) Real GDP. D) Real GNP.

Interest income	$200
Transfer payments Wages 150	$60
Depreciation	$50
Gross Investment	300
Business profits	400
Indirect business taxes	$80
Rent	$90
Next Exports	$20
Government purchases	$200
Net foreign factor income	$10
Consumption	$500
Unemployment benefits	$600

36. Refer to the table above about a small economy in year 2010. The economy GDP using expenditure

approach was ___________, while the economy national income in 2010 was __________

a) $1,620; 1,090 b) $1,120; 1,220 c) $1,020; $770 d) $1,080; $1,020

37. Assume an economy produces just cars and computers; use the information in the table below to answer the following questions about the GDP. Assume year 2014 as the base-year.

	Cars	Computers
Year	Quantity	Price	Quantity	Price
2014	100	$10,000	1,000	$1,000
2015	110	$12,000	1,100	$900

Refer to the table above. The Real GDP in year 2014 in the base year prices was________________, while the Real GDP in 2015 in the base-year was_____________; the rate of economic growth in year 2015 was __________ percent:

a. $1,000,000; $2,000,000; 8% b. $3,300,000; $6,300,000; 13%

c. $2,000,000; $2,200,000; 10% d. $2,000,000; $5,850,000; 15%

38. Refer to the table below. The Real GDP in 2001 was_________________, while the GDP Deflator in in 2002 was _______________.

Year	Real GDP	Nominal GDP	GDP Deflator
2000	8144.8	______	101.9
2001	______	8759.9	103.1
2002	8848.2	9256.1	______

a) 8496.5; 104.6 b) 8144; 7992.9 c) 18015. 0; 101.2 d) 7034.2; 205

39. Real GDP will increase:

a. only if price level rises

b. only if the price level falls

c. only if the quantity of final goods and services produced rises

d. if either the price level rises or the quantity of final goods and services produced rises

40. The optimal rate of economic growth in the U.S. is__________, if the economic grows above the optimal rate, economists expect ________

a) 5 %; stable economic growth b) 2.5% -3 %; strong spending and inflation.

c) 2%; weak economy and unemployment d) 2%-5%, hyperinflation.

41. A country GDP measures:

A) a society's well-being especially when the real GDP increases from one year to another.

B) a country total production and income.

C) how equally income is distributed in the economy.

D) income inequality in the economy.

42.The unemployment rate is derived from data on:

A) the size of both the labor force and the population.

B) the number of unemployed persons and the number of discouraged workers.

C) the size of the labor force and the number of unemployed persons.

D)the number of persons in the labor force and the labor force participation rate.

43. Use the following information on an economy: Working- age population = 200million, currently working = 120 million, currently looking for work = 10 million, currently available for work but not working because they have given up searching for work = 2 million, available for work but not working due to transportation problems = 1 million, full time students, retirees and homemakers = 7 million. Assume the natural rate of unemployment (NRU) for this economy is 5 percent. Given the data above the official unemployment rate is: _______________ percent, while the labor force participation rate is: ____________percent.

A) 10%; 60% B) 7.6%; 65% C) 6.0%; 60% D) 8.5%; 63.5%

44. Suppose that economy has 9 million people working full time. It also has 1 million people who are actively seeking work but currently unemployed as well as 2 million discouraged workers who have given up looking for work and are currently unemployed. Assume that this economy NRU is 6%. The official unemployment rate for this economy's is ________ percent and the output gap ________percent; the full employment rate is _________________

a) 11 percent; positive 6%; 10% b) 10 percent; negative 8%; 6%

c) 20 percent; negative 5%; 4% d) 25 percent; positive 5%; 5%

45. Reduced labor force participation by aging baby boomers decreases measured growth most directly by:

A) slowing the development of new technologies.

B) decreasing capital accumulation.

C) decreasing the availability of resources.

D) altering the nature of growth enhancing institutions.

46. Use the following information on an economy: Working- age population = 200million, currently working = 120 million, currently looking for work = 10 million, currently available for work but not working because they have given up searching for work = 2 million, available for work but not working due to transportation problems = 1 million, full time students, retirees and homemakers = 7 million. Assume the natural rate of unemployment (NRU) for this economy is 5 percent. Given the data above if the country official unemployment rate is ______, but if the discouraged workers were counted as unemployed, the unemployment rate would be: _______________ percent.

A) 9.00% ; 9.23% B) 9.2% ; 6.00% C) 7.69%; 9.09% D) 6.76%; 9.77%