no missing data*** select the most correct answer

1.(1)

GDP per capita:

is highly correlated with quality of life.

is perfectly correlated with quality of life.

is loosely correlated with quality of life.

is negatively correlated with quality of life.

2.(1)

The many goods and services that are sold below the radar, outside of official records take place in the:

underground economy.

soft market.

illegal economy.

None of these statements is true.

3(1)

A recession is characterized by:

a period of significant decline in economic activity.

falling GDP.

increasing unemployment.

All of these statements are true.

4(1)

One of the most common uses of GDP is:

to track changes in an economy over time.

to see which country has the most fair distribution of wealth.

to evaluate different standards of living across countries.

All of these statements are true.

5.(1)

GDP per capita:

is an average income per person in an economy.

tells us about how the output is allocated in an economy.

tells us about what you can buy with a given amount of money in that country.

All of these statements are true.

6.(1)

Real GDP:

is calculated based on goods and services valued at constant prices.

is calculated based on goods and services valued at current prices (current at the time of production).

is useful in clearly seeing changes in prices over time using GDP.

None of these statements is true.

7.(1)

Consumption:

is the largest component of GDP.

is the value of total goods purchased by consumers.

does not include the price of new homes.

All of these are true.

8.(1)

The largest component of GDP is:

C.

I.

G.

NX.

9.(1)

The four components that make up GDP are:

C, I, G, and NX.

C, I, G, and EX.

K, I, G, and NX.

C, I_m, G, and EX.

10.(1)

An example of a U.S. import would be:

a French bottle of wine consumed by an American.

an Apple computer purchased by a U.S. college student who plans to study abroad in France.

a bushel of apples that Canadians pick and enjoy during a love fall day in Vermont.

None of these would be considered an import.

11.(1)

The value of net exports is:

exports minus imports.

imports minus exports.

exports plus imports.

(exports plus imports) minus tariffs.

12.(1)

Inventory is:

the stock of goods that a company produces now, but keeps to sell at a future time.

the stock of goods that a company produced last year, but had to sell for below cost.

the total amount of goods that a company produces now, regardless of whether they've sold it or not.

the stock of goods that a company produces and sells in a given time period.

13.(1)

Consumption, as a component of GDP:

measures spending on goods and services by private individuals and households.

includes nondurable goods only.

includes durable goods only.

measures spending only on goods, not services, by private individuals and households.

14.(1)

U.S. Gross National Product includes:

goods produced by foreign firms on U.S. soil.

goods produced by U.S. firms on foreign soil.

goods produced by foreign firms on foreign soil.

None of these statements is true.

15.(1)

Gross domestic product is:

the sum of the market values of all final goods and services produced within a country in a given period of time.

the sum of the market values of all intermediate goods and services produced within a country in a given period of time.

the sum of all final goods and services produced by a country's citizens in a given period of time.

the sum of the market values of all final goods and services produced by a country's citizens in a given period of time.

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16.(1)

An example of a nontradable good is:

a bottle of wine from a remote valley in France.

a rare gemstone found in South Africa.

a haircut by a renowned Italian hairstylist in Florence.

All of these would be considered a nontradable good.

17.(1)

COLA stands for:

cost-of-living adjustment.

cost-of-living aggregate.

capital operations leasing adjustment.

capital operations leasing agreement.

18.(1)

Suppose we want to know how much money your grandparents would have to earn now to have purchasing power equivalent to their income in 1969. We could:

translate their nominal income in 1969 into constant, real dollars of today.

translate their nominal income today into 1969 dollars.

take a ratio of their income today with their income from 1969.

None of these statements is true.

19.(1)

The price index that measures the prices of goods and services purchased by firms is called the:

PPI.

CPI.

RPI.

PRI.

20(1)

Core inflation:

measures the changes in prices for the entire market basket of the average urban consumer.

is inflation measured using the producer price index.

measures price changes for the market basket of the average urban consumer with food and energy costs taken out.

is inflation measured using the retail price index.

21.(1)

The consumer price index:

measures the increase in the cost of the market basket relative to the cost in a given base year.

is always 100 in the base year.

helps us understand how the cost of living today compares with the cost of living at some time in the past.

All of these statements are true.

22.(1)

The consumer price index is calculated by:

the Bureau of Labor Statistics.

the Congressional Budget Office.

the National Bureau of Economic Research.

the Social Security Office.

23.(1)

A market basket:

is a tool devised to track how changing prices affect consumers.

includes all the goods and services produced in an economy.

includes all the goods and services consumed in an economy, including imports.

includes all the goods and services consumed in an economy, including net exports.