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ECON 201 FINAL EXAM | Questions with Answers 100% Verified Correct| Already Passed
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ECON 201 FINAL EXAM | Questions with Answers 100% Verified Correct| Already Passed
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ECON 201 FINAL EXAM | Questions withAnswers 100% Verified Correct| Already Passed
Which of the following is NOT an example of private investment expenditure?
a. new plants and equipment added during the year
b. new houses built during the year
c. using credit cards to purchase durable and nondurable goods
d. increases in inventories on goods produced during the year - ✔✔c. using credit cards to
purchase durable and nondurable goods
The GDP equation is
a. Y = C - I - G - NX.
b. C + I = G + NX.
c. Y = C + I + G + NX
d. C + I = Y + G + NX - ✔✔c. Y = C + I + G + NX
Depreciation is
a. the wear and tear on private investment.
b. what is left over from total new private investment after use for a year.
c. the total amount of new private investment purchases.
d. the total amount of private investment purchases, whether new or previously existing. -
✔✔a. the wear and tear on private investment.
,When considering imports & exports, economists include the _____ as a component of the
GDP.
a. net exports
b. total exports
c. gross exports
d. total imports - ✔✔a. net exports
Exports ________ GDP and imports ________ GDP.
a. increase; decrease
b. decrease; decrease
c. decrease; increase
d. increase; increase - ✔✔a. increase; decrease
If in the 3rd quarter of 2016 total investment spending was $4,768 billion & depreciation was
$3,292 billion, then the amount counted in GDP, which is known as gross investment, would be
a. $1,476 billion.
b. $3,292 billion.
c. $4,768 billion.
d. $8,060 billion. - ✔✔c. $4,768 billion.
Social Security payments are examples of
a. durable goods.
b. transfer payments
c. nondurable goods
,d. services. - ✔✔b. transfer payments
As depicted in the circular flow diagram, firms
a. supply the resources that households demand in factor markets.
b. demand the resources that households supply in product markets.
c. supply the goods and services that households demand in product markets.
d. demand the goods and services that households supply in product markets. - ✔✔c. supply
the goods and services that households demand in product markets.
If in the third quarter of 2016 total investment spending was $4,768 billion and depreciation
was $3,292 billion, then net investment was equal to:
a. $1,476 billion.
b. $3,292 billion.
c. $4,768 billion.
d. $8,060 billion. - ✔✔a. $1,476 billion.
Transfer payments are excluded from government purchases in GDP accounting because
a. nothing is being produced in return for the payment.
b. they are a reward to individuals who have been productive their entire lives.
c. they are already included as part of investment
d. they are difficult to measure. - ✔✔a. nothing is being produced in return for the payment.
A rancher raises sheep. Once a year he shears them and sells the raw wool to a processor who
cleans it & spins it into yarn. The yarn is then sold to a knitting mill, which produces and sells
sweaters. In calculating GDP we would count
, a. only the sweaters
b. only the raw wool and the yarn.
c. only the yarn and the sweaters.
d. the raw wool, the yarn and the sweaters. - ✔✔a. only the sweaters
Which of the following should be included in U.S. GDP?
a. a 3D television manufactured in the United States and sold in Thailand
b. a 3D television manufactured in Thailand and sold in the United States
c. a 3D television manufactured in Thailand by a U.S. firm & sold in the U. S.
d. a used 3D television manufactured in the United States and sold in Thailand - ✔✔a. a 3D
television manufactured in the United States and sold in Thailand
Which of the following is NOT a component of gross domestic product?
a. net exports
b. purchases by consumers of used goods
c. purchases by consumers of finished goods
d. government purchases - ✔✔b. purchases by consumers of used goods
For the purposes of GDP accounting, government purchases include
a. welfare payments.
b. the purchases of new military equipment.
c. direct transfer payments by the government to other individuals.
d. Social Security payments. - ✔✔b. the purchases of new military equipment.
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