MacroReviewTest

Student: ___________________________________________________________________________ 1. The two general types of economic systems that exist today are: A. market systems and capitalism. B. socialism and central planning. C. market systems and command systems. D. laissez faire systems and pure command systems.

2. Specialization in production is important primarily because it: A. results in greater total output. B. allows society to avoid the coincidence-of-wants problem. C. allows society to trade by barter. D. allows society to have fewer capital goods.

3. The coordination problem in the centrally planned economies refers to the idea that: A. planners had to direct required inputs to each enterprise. B. the price level and the level of employment were inversely related. C. the immediate effect of more investment was less consumption. D. exports had to be equal to imports for a central plan to work.

4. In terms of the circular flow diagram, households make expenditures in the _____ market and receive income through the _____ market. A. product; financial B. resource; product C. product; resource D. capital; product

5. In the circular flow model: A. households sell resources to firms. B. households receive income through the product market. C. households spend income in the resource market. D. businesses neither buy nor sell resources.

6. Households and businesses are: A. both buyers in the resource market. B. both sellers in the product market. C. sellers in the resource and product markets respectively. D. sellers in the product and resource markets respectively.

7. In a competitive economy prices: A. influence consumers in their purchases of goods and services. B. influence businesses in their purchases of economic resources. C. influence workers in making occupational choices. D. do all of the above.

8. In a market economy the distribution of output will be determined primarily by: A. consumer needs and preferences. B. the quantities and prices of the resources that households supply. C. government regulations that provide a minimum income for all. D. a social consensus as to what distribution of income is most equitable.

9. The market system's answer to the fundamental question "Who will get the goods and services?" is essentially: A. "Those willing and able to pay for them." B. "Those who physically produced them." C. "Those who most need them." D. "Those who get utility from them."

10. The market system: A. produces considerable inefficiency in the use of scarce resources. B. effectively harnesses the incentives of workers and entrepreneurs. C. is inconsistent with freedom of choice in the long run. D. has slowly lost ground to emerging command systems.

11. The law of demand states that: A. price and quantity demanded are inversely related. B. the larger the number of buyers in a market, the lower will be product price. C. price and quantity demanded are directly related. D. consumers will buy more of a product at high prices than at low prices.

C. Which of the following will cause the demand curve for product A to shift to the left? A. B. there are many goods that are complementary to bicycles. B. an increase in money income if A is an inferior good . an upsloping line on a graph that relates consumer purchases and product price. population growth that causes an expansion in the number of persons consuming A B.12. there are few goods that are substitutes for bicycles. An economist for a bicycle company predicts that. 13. consumers substitute relatively high-priced for relatively low-priced products. D. there are many goods that are substitutes for bicycles. a rise in consumer incomes will increase the demand for bicycles. a particular price-quantity combination on a stable demand curve. a schedule of various combinations of market prices and amounts demanded. a decrease in the price of complementary product C D. 16. which in turn caused the price of natural gas to rise. substitute goods and the higher price for oil decreased the supply of natural gas. an increase in money income if A is a normal good C. complementary goods and the higher price for oil decreased the supply of natural gas. An increase in the price of a product will reduce the amount of it purchased because: A. D. This can best be explained by saying that oil and natural gas are: A. the total amount spent on a particular commodity over a stipulated time period. B. supply curves are upsloping. 15. consumers will substitute other products for the one whose price has risen. C. In 2003 the price of oil increased. the higher price means that real incomes have risen. D. This prediction is based on the assumption that: A. B. C. other things equal. 14. complementary goods and the higher price for oil increased the demand for natural gas. Economists use the term demand to A. C. substitute goods and the higher price for oil increased the demand for natural gas. bicycles are normal goods. D.

Answer the next question(s) on the basis of the given supply and demand data for wheat: . An increase in the excise tax on cigarettes raises the price of cigarettes by shifting the: A. complementary goods. D. substitute goods. Cameras and film are: A. normal goods. In moving along a stable supply curve which of the following is not held constant? A. the price of the product for which the supply curve is relevant 20. B. 19. This suggests that ramen noodles and boxed macaroni and cheese are: A. demand curve for cigarettes rightward. supply curve for cigarettes leftward. B. C. expectations about the future price of the product C. 18. the number of firms producing this good B. inferior goods. their consumption of these goods frequently declines. supply curve for cigarettes rightward. C. complementary goods. College students living off-campus frequently consume large amounts of ramen noodles and boxed macaroni and cheese. demand curve for cigarettes leftward. When they finish school and start their careers. techniques used in producing this product D. substitute goods. C. D.17. D. inferior goods. independent goods. B.

$1. If the price in this market was $4: A. $2. There will be a surplus of a product when: A. C. 22. C. 25. B. C. C. 23. B. D. the demand and supply curves fail to intersect. whenever the demand curve is downsloping and the supply curve is upsloping. B. Refer to the above data. there would be a shortage of wheat. B. buyers would want to purchase more wheat than is currently being supplied. at all prices above that shown by the intersection of the supply and demand curves. increase the supply of coffee. An unusually large crop of coffee beans might: A. B. if the amount producers want to sell is equal to the amount consumers want to buy. increase the price of coffee. increase the price of tea. $4. . D. provided there is no surplus of the product. price is below the equilibrium level.21. the market would clear. D. C. decrease the quantity of coffee consumed. A market is in equilibrium: A. farmers would not be able to sell all their wheat. quantity demanded would equal quantity supplied. D. Equilibrium price will be: A. 24. Refer to the above data. the supply curve is downward sloping and the demand curve is upward sloping. D. $3. consumers want to buy less than producers offer for sale.

29. national income minus all nonincome charges against output. If government set a maximum price of $45 in the above market: A. a surplus of 40 units would arise. government is imposing a minimum legal price that is typically above the equilibrium price. is always some amount less than its C + Ig + G + Xn. is the dollar value of the total output produced by its citizens. D. produced in a specific year. B. be determining the market value of all resources used in the production process. is the dollar value of the total output produced within the borders of the nation. final and intermediate. . C. monetary value of all economic resources used in producing a year's output. B. B. interfere with the rationing function of prices. D. neither a shortage nor a surplus would arise. D. can be found by summing C + In + S + Xn. monetary value of all goods and services. shift demand and supply curves and therefore have no effect on the rationing function of prices. a shortage of 21 units would arise. a surplus of 21 units would arise. A nation's gross domestic product (GDP): A. 28. B. The GDP is the: A. D. obtain a sum substantially larger than the GDP.26. B. By summing the dollar value of all market transactions in the economy we would: A. C. D. cause surpluses and shortages respectively. 27. C. inflation is severe in this particular market. D. C. monetary value of all final goods and services produced within a nation in a particular year. be measuring GDP. B. 31. government is imposing a maximum legal price that is typically below the equilibrium price. C. regardless of where they are living. Price ceilings and price floors: A. be determining value added for the economy. make the rationing function of free markets more efficient. A price floor means that: A. 30. sellers are artificially restricting supply to raise price. C.

$190 billion. investment. and imports. net investment plus replacement investment. included when calculating GDP because they are a category of investment spending. D. a nation's imports exceed its exports. $200 billion. B. D. consumption. consumption. government consumption goods. B. and imports. investment. government consumption goods and public capital goods. government purchases. a nation's exports exceed its imports. public capital goods only. 33. Government purchases include government spending on: A. consumption. C. 35. Transfer payments are: A. consumption. the economy's stock of capital goods is declining. B. C. investment. private investment minus public investment. wages. . public capital goods. B. depreciation exceeds domestic investment. 36. excluded when calculating GDP because they only reflect inflation. 34. C. $180 billion. exports. and net exports. government consumption goods only. government purchases. B. D. included when calculating GDP because they increase the spending of recipients. B. Suppose that GDP was $200 billion in year 1 and that all other components of expenditures remained the same in year 2 except that business inventories increased by $10 billion. D. government purchases. C. Net exports are negative when: A. investment. C. net investment after it has been "inflated" for changes in the price level. D.32. excluded when calculating GDP because they do not reflect current production. 37. C. and transfer payments. $210 billion. net investment plus net exports. GDP in year 2 is: A. GDP can be calculated by summing: A. and rents. Gross investment refers to: A. D.

C. Refer to the above data. E. $492. D. 40. GDP is: A. the economy's production capacity is expanding. $422. D. the economy is importing more than it exports.38. $417. B. GDP excludes: A. we can conclude that: A. nominal GDP is rising but real GDP is declining. C. B. D. $390. the market value of unpaid work in the home. C. positive changes in inventories. . All figures are in billions of dollars. If depreciation (consumption of fixed capital) exceeds domestic investment. 39. $512. the production of services. Answer the next question(s) on the basis of the following data. B. net investment is negative. the production of nondurable goods.

$392. DI is: A. Refer to the above data. D. Real GDP measures: A. PI is: A. B. the Producer Price Index (PPI). current output at current prices. $372. $402. 42. . base year output at current prices. $402. B. D. Refer to the above data. $274. 46. the GDP price index. C. B. 45. C. $284. $370.41. D. $437. C. $408. the Consumer Price Index (CPI). $329. D. D. C. $447. $402. B. exchange rates. $346. Refer to the above data. 43. current output at base year prices. C. B. $314. $362. Refer to the above data. D. C. $467. NI is: A. Nominal GDP is adjusted for price changes through the use of: A. 44. B. NDP is: A. base year output at current exchange rates.

200. nominal income declined by more than personal income. C. B. the price level fell by more than real GDP. C. GDP data are criticized as being inaccurate measures of economic welfare because: A. C. nominal GDP increased but U. D. GDP. of all of the above considerations. 100. 240. Environmental pollution is accounted for in: A. the accuracy of GDP will be unaffected through time.47.S. they do not take into account all changes in product quality. D. C. . D. We can conclude that: A. D. In the second quarter (3-month period) of 2001. B. U. D. Assume that the size of the underground economy increases both absolutely and relatively over time. they do not take into account the adverse effects of economic activity on the environment. 51. 300. As a result: A. real GDP will rise more rapidly than nominal GDP. If real GDP in a particular year is $80 billion and nominal GDP is $240 billion. real GDP declined. B. 50. the GDP price index for that year is: A. real wages declined by more than real GDP. B. B. PI. GDP will tend to increasingly overstate the level of output through time.S. DI. the price level rose by more than nominal GDP. C. they do not take into account changes in the amount of leisure. 48. 49. GDP will tend to increasingly understate the level of output through time. none of the above.

allows society to have fewer capital goods. c. Specialization in production is important primarily because it: A. allows society to avoid the coincidence-of-wants problem. C. b. The two general types of economic systems that exist today are: a. d. market systems and capitalism. socialism and central planning. b.Chapter 02 #1 Micro: 29 Topic: 1 Type: Fact 2. market systems and command systems. allows society to trade by barter. d.MacroReviewTest Key 1. results in greater total output. Econ: 29 Learning Objective: 2-1 Macro: 29 McConnell .Chapter 02 #20 Micro: 32 Status: New Topic: 2 Type: Definition . Econ: 32 Learning Objective: 2-2 Macro: 32 McConnell . laissez faire systems and pure command systems.

Chapter 02 #66 Micro: 38 Status: New Topic: 5 Type: Application of a Concept 4. households sell resources to firms. d. households receive income through the product market. resource d. households make expenditures in the _____ market and receive income through the _____ market.Chapter 02 #86 Micro: 39 Topic: 6 Type: Definition 5. resource. financial b.3. households spend income in the resource market. Econ: 38 Learning Objective: 2-1 Macro: 38 McConnell . c. d. Econ: 39 Learning Objective: 2-5 Macro: 39 McConnell . businesses neither buy nor sell resources. product. capital. The coordination problem in the centrally planned economies refers to the idea that: A. planners had to direct required inputs to each enterprise. product C. c. exports had to be equal to imports for a central plan to work. product.Chapter 02 #89 Micro: 39 Topic: 6 Type: Definition . product Econ: 39 Learning Objective: 2-5 Macro: 39 McConnell . b. In terms of the circular flow diagram. In the circular flow model: A. the immediate effect of more investment was less consumption. b. a. the price level and the level of employment were inversely related.

sellers in the product and resource markets respectively. both buyers in the resource market. influence businesses in their purchases of economic resources. Households and businesses are: a. government regulations that provide a minimum income for all. B. In a competitive economy prices: a. D. c. sellers in the resource and product markets respectively. influence workers in making occupational choices. In a market economy the distribution of output will be determined primarily by: a. consumer needs and preferences. b. d. both sellers in the product market.6.Chapter 02 #40 Micro: 34 Status: New Topic: 3 Type: Application of a Concept 8. d. influence consumers in their purchases of goods and services. the quantities and prices of the resources that households supply. a social consensus as to what distribution of income is most equitable. do all of the above.Chapter 02 #44 Micro: 35 Status: New Topic: 3 Type: Application of a Concept .Chapter 02 #88 Micro: 39 Topic: 6 Type: Definition 7. b. Econ: 35 Learning Objective: 2-3 Macro: 35 McConnell . Econ: 34 Learning Objective: 2-3 Macro: 34 McConnell . c. Econ: 39 Learning Objective: 2-5 Macro: 39 McConnell . C.

effectively harnesses the incentives of workers and entrepreneurs. consumers will buy more of a product at high prices than at low prices. is inconsistent with freedom of choice in the long run. price and quantity demanded are directly related. c. the lower will be product price.Chapter 02 #65 Micro: 37 Status: New Topic: 4 Type: Application of a Concept 11. d. the larger the number of buyers in a market. The market system's answer to the fundamental question "Who will get the goods and services?" is essentially: A. The market system: a. Econ: 37 Learning Objective: 2-3 Macro: 37 McConnell . "Those who most need them. "Those who get utility from them. B." d. The law of demand states that: A. produces considerable inefficiency in the use of scarce resources.9. b. has slowly lost ground to emerging command systems. Econ: 46 Learning Objective: 3-1 Macro: 46 McConnell . price and quantity demanded are inversely related. "Those willing and able to pay for them. d." Econ: 35 Learning Objective: 2-3 Macro: 35 McConnell . "Those who physically produced them.Chapter 03 #3 Micro: 46 Topic: 1 Type: Definition .Chapter 02 #54 Micro: 35 Status: New Topic: 3 Type: Application of a Concept 10. c." c." b.

the higher price means that real incomes have risen. C. consumers will substitute other products for the one whose price has risen. d. Economists use the term demand to a. In 2003 the price of oil increased.Chapter 03 #11 Micro: 46 Topic: 1 Type: Definition 14. b. substitute goods and the higher price for oil increased the demand for natural gas. An increase in the price of a product will reduce the amount of it purchased because: a. supply curves are upsloping. c. an upsloping line on a graph that relates consumer purchases and product price. Econ: 49 Learning Objective: 3-1 Macro: 49 McConnell . Econ: 45 Learning Objective: 3-1 Macro: 45 McConnell . a schedule of various combinations of market prices and amounts demanded. B. b.Chapter 03 #6 Micro: 45 Topic: 1 Type: Definition 13. the total amount spent on a particular commodity over a stipulated time period. a particular price-quantity combination on a stable demand curve. complementary goods and the higher price for oil increased the demand for natural gas. c. consumers substitute relatively high-priced for relatively low-priced products. Econ: 46 Learning Objective: 3-1 Macro: 46 McConnell . complementary goods and the higher price for oil decreased the supply of natural gas. substitute goods and the higher price for oil decreased the supply of natural gas. which in turn caused the price of natural gas to rise. D.12. This can best be explained by saying that oil and natural gas are: a. d.Chapter 03 #23 Micro: 49 Topic: 2 Type: Application of Concept .

Econ: 48 Learning Objective: 3-1 Macro: 48 McConnell .Chapter 03 #24 Micro: 48 Topic: 2 Type: Application of Concept 16. Which of the following will cause the demand curve for product A to shift to the left? a. This prediction is based on the assumption that: a.Chapter 03 #35 Micro: 48 Topic: 2 Type: Application of Concept 17. c. bicycles are normal goods. An economist for a bicycle company predicts that. there are many goods that are substitutes for bicycles. a rise in consumer incomes will increase the demand for bicycles. an increase in money income if A is a normal good c. other things equal. there are many goods that are complementary to bicycles. normal goods.15.Chapter 03 #38 Micro: 48 Status: New Topic: 2 Type: Application of Concept . b. When they finish school and start their careers. c. College students living off-campus frequently consume large amounts of ramen noodles and boxed macaroni and cheese. D. substitute goods. inferior goods. This suggests that ramen noodles and boxed macaroni and cheese are: A. a decrease in the price of complementary product C D. population growth that causes an expansion in the number of persons consuming A b. complementary goods. there are few goods that are substitutes for bicycles. b. Econ: 48 Learning Objective: 3-1 Macro: 48 McConnell . their consumption of these goods frequently declines. d. an increase in money income if A is an inferior good Econ: 48 Learning Objective: 3-1 Macro: 48 McConnell .

demand curve for cigarettes leftward. demand curve for cigarettes rightward. b. Econ: 49 Learning Objective: 3-1 Macro: 49 McConnell . c. supply curve for cigarettes leftward. the number of firms producing this good b. independent goods.Chapter 03 #44 Micro: 49 Topic: 2 Type: Application of Concept 19.Chapter 03 #90 Micro: 52 Status: New Topic: 5 Type: Application of Concept . Cameras and film are: a. B.Chapter 03 #83 Micro: 53 Topic: 5 Type: Application of Concept 20. In moving along a stable supply curve which of the following is not held constant? a. inferior goods. supply curve for cigarettes rightward. the price of the product for which the supply curve is relevant Econ: 53 Learning Objective: 3-2 Macro: 53 McConnell . expectations about the future price of the product c. D. techniques used in producing this product D. complementary goods.18. substitute goods. d. c. An increase in the excise tax on cigarettes raises the price of cigarettes by shifting the: a. Econ: 52 Learning Objective: 3-2 Macro: 52 McConnell .

Econ: 53 Learning Objective: 3-3 Macro: 53 McConnell . quantity demanded would equal quantity supplied. Refer to the above data. Equilibrium price will be: a. d. $1. $3. $2.Chapter 03 #99 Micro: 53 Topic: 6 Type: Table 22. $4. C. farmers would not be able to sell all their wheat. Refer to the above data.Answer the next question(s) on the basis of the given supply and demand data for wheat: McConnell . b. If the price in this market was $4: a. C.Chapter 03 #100 Micro: 53 Topic: 6 Type: Table . Econ: 53 Learning Objective: 3-3 Macro: 53 McConnell . b. the market would clear. buyers would want to purchase more wheat than is currently being supplied. there would be a shortage of wheat. d.Chapter 03 21.

increase the supply of coffee. b.Chapter 03 #153 Micro: 53 Topic: 7 Type: Application of Concept . An unusually large crop of coffee beans might: A. the supply curve is downward sloping and the demand curve is upward sloping. price is below the equilibrium level. increase the price of tea. c. the demand and supply curves fail to intersect. d. c. Econ: 53 Learning Objective: 3-2 Macro: 53 McConnell .Chapter 03 #126 Micro: 54 Topic: 6 Type: Definition 25. increase the price of coffee. at all prices above that shown by the intersection of the supply and demand curves. A market is in equilibrium: a. Econ: 53 Learning Objective: 3-3 Macro: 53 McConnell . consumers want to buy less than producers offer for sale.Chapter 03 #106 Micro: 53 Topic: 6 Type: Definition 24. Econ: 54 Learning Objective: 3-3 Macro: 54 McConnell . provided there is no surplus of the product.23. b. decrease the quantity of coffee consumed. C. There will be a surplus of a product when: a. if the amount producers want to sell is equal to the amount consumers want to buy. whenever the demand curve is downsloping and the supply curve is upsloping. D. b. d.

government is imposing a maximum legal price that is typically below the equilibrium price.Chapter 03 26. sellers are artificially restricting supply to raise price. a surplus of 40 units would arise. a surplus of 21 units would arise. D. Econ: 59 Learning Objective: 3-5 Macro: 59 McConnell . government is imposing a minimum legal price that is typically above the equilibrium price. c.Chapter 03 #192 Micro: 59 Status: New Topic: 8 Type: Definition . D. b. neither a shortage nor a surplus would arise. b. c.McConnell . inflation is severe in this particular market. a shortage of 21 units would arise.Chapter 03 #185 Micro: 58 Topic: 8 Type: Table 27. If government set a maximum price of $45 in the above market: a. A price floor means that: a. Econ: 58 Learning Objective: 3-5 Macro: 58 McConnell .

c. produced in a specific year. monetary value of all economic resources used in producing a year's output. is the dollar value of the total output produced by its citizens.Chapter 03 #196 Micro: 60 Topic: 8 Type: Application of Concept 29. A nation's gross domestic product (GDP): A.28. national income minus all nonincome charges against output. The GDP is the: A. interfere with the rationing function of prices. d. final and intermediate. b. Econ: 60 Learning Objective: 3-5 Macro: 60 McConnell . is always some amount less than its C + Ig + G + Xn. monetary value of all goods and services. regardless of where they are living. can be found by summing C + In + S + Xn. is the dollar value of the total output produced within the borders of the nation. make the rationing function of free markets more efficient.Chapter 06 #1 Topic: 1 Type: Definition 30.Chapter 06 #3 Topic: 1 Type: Definition . Econ: 106 Learning Objective: 6-1 Macro: 106 McConnell . b. Price ceilings and price floors: a. Econ: 106 Learning Objective: 6-1 Macro: 106 McConnell . shift demand and supply curves and therefore have no effect on the rationing function of prices. monetary value of all final goods and services produced within a nation in a particular year. d. b. c. C. cause surpluses and shortages respectively. d.

Chapter 06 #21 Topic: 2 Type: Application of Concept . B. c. and net exports. be determining the market value of all resources used in the production process. d.Chapter 06 #16 Topic: 2 Type: Application of Concept 33. d. government purchases. c. By summing the dollar value of all market transactions in the economy we would: a. government purchases. consumption. investment. consumption. be determining value added for the economy. investment.Chapter 06 #9 Topic: 1 Type: Application of Concept 32. depreciation exceeds domestic investment. c. and imports. exports. and imports. Econ: 110 Learning Objective: 6-1 Macro: 110 McConnell . a nation's exports exceed its imports. consumption. consumption. Econ: 106 Learning Objective: 6-1 Macro: 106 McConnell . investment. be measuring GDP. wages. b. Econ: 108 Learning Objective: 6-1 Macro: 108 McConnell . the economy's stock of capital goods is declining. investment. B. d. and rents. government purchases. a nation's imports exceed its exports.31. Net exports are negative when: A. GDP can be calculated by summing: a. obtain a sum substantially larger than the GDP.

net investment plus net exports.Chapter 06 #35 Topic: 2 Type: Definition . $190 billion. net investment plus replacement investment. public capital goods only. private investment minus public investment. b. Econ: 109 Learning Objective: 6-1 Macro: 109 McConnell . $200 billion. $210 billion. net investment after it has been "inflated" for changes in the price level. and transfer payments. d. Suppose that GDP was $200 billion in year 1 and that all other components of expenditures remained the same in year 2 except that business inventories increased by $10 billion. GDP in year 2 is: a. Government purchases include government spending on: A. c. government consumption goods and public capital goods. b.Chapter 06 #20 Topic: 2 Type: Definition 35. government consumption goods only. $180 billion. c. d. B. c.34.Chapter 06 #29 Topic: 2 Type: Complex Analysis 36. government consumption goods. Econ: 109 Learning Objective: 6-1 Macro: 109 McConnell . public capital goods. D. Econ: 108 Learning Objective: 6-1 Macro: 108 McConnell . Gross investment refers to: a.

d. the economy's production capacity is expanding. we can conclude that: a. nominal GDP is rising but real GDP is declining.Chapter 06 #47 Topic: 3 Type: Application of Concept 39. included when calculating GDP because they are a category of investment spending. Transfer payments are: a. c. c. included when calculating GDP because they increase the spending of recipients. d. d. the market value of unpaid work in the home. the production of services. c. B. If depreciation (consumption of fixed capital) exceeds domestic investment. Econ: 118 Learning Objective: 6-1 Macro: 118 McConnell . the production of nondurable goods. the economy is importing more than it exports.Chapter 06 #37 Topic: 2 Type: Application of Concept 38. Econ: 109 Learning Objective: 6-2 Macro: 109 McConnell . excluded when calculating GDP because they only reflect inflation. positive changes in inventories. excluded when calculating GDP because they do not reflect current production.Chapter 06 #57 Topic: 3 Type: Application of Concept . net investment is negative. b. GDP excludes: A. B.37. Econ: 110 Learning Objective: 6-1 Macro: 110 McConnell .

$512.Chapter 06 #60 Topic: 4 Type: Table 41.Chapter 06 #61 Topic: 4 Type: Table . $390. d.Chapter 06 40. $402. All figures are in billions of dollars. $370. c. b. Econ: 113 Learning Objective: 6-2 Macro: 113 McConnell . Refer to the above data. McConnell . $492. Refer to the above data. e. $392. NDP is: a. $422. $417. B. GDP is: a. d. $467. Econ: 110 Learning Objective: 6-1 Macro: 110 McConnell . C.Answer the next question(s) on the basis of the following data.

b. Econ: 113 Learning Objective: 6-2 Macro: 113 McConnell . PI is: A.42. d.Chapter 06 #64 Status: New Topic: 4 Type: Table . $372. C. $402. Econ: 114 Learning Objective: 6-2 Macro: 114 McConnell . D. $346. c. b. Refer to the above data. $362. Econ: 113 Learning Objective: 6-2 Macro: 113 McConnell . $408. b. $437.Chapter 06 #63 Status: New Topic: 4 Type: Table 44. DI is: a. NI is: a. $447. $314. Refer to the above data. $402. d. Refer to the above data. $274. $284.Chapter 06 #62 Status: New Topic: 4 Type: Table 43. $329. c.

base year output at current exchange rates. the Consumer Price Index (CPI). base year output at current prices. C. exchange rates. nominal GDP increased but U. d. d.Chapter 06 #110 Topic: 7 Type: Application of Concept . the GDP price index. U.Chapter 06 #109 Topic: 7 Type: Definition 47. Econ: 116 Learning Objective: 6-4 Macro: 116 McConnell . We can conclude that: a.S. nominal income declined by more than personal income. b. B. d. B. the Producer Price Index (PPI). Real GDP measures: a. In the second quarter (3-month period) of 2001. real wages declined by more than real GDP.S. current output at base year prices. current output at current prices.45. c. Econ: 116 Learning Objective: 6-4 Macro: 116 McConnell . c. the price level fell by more than real GDP. Nominal GDP is adjusted for price changes through the use of: a. the price level rose by more than nominal GDP. Econ: 116 Learning Objective: 6-3 Learning Objective: 6-4 Macro: 116 McConnell .Chapter 06 #108 Topic: 7 Type: Definition 46. real GDP declined.

PI. none of the above. Econ: 119 Learning Objective: 6-5 Macro: 119 McConnell .Chapter 06 #118 Topic: 7 Type: Application of Concept 49. the accuracy of GDP will be unaffected through time. c. GDP will tend to increasingly overstate the level of output through time. As a result: a. 240. D. If real GDP in a particular year is $80 billion and nominal GDP is $240 billion.Chapter 06 #161 Topic: 8 Type: Application of Concept 50. D. 300. the GDP price index for that year is: a. DI. Assume that the size of the underground economy increases both absolutely and relatively over time. c. Econ: 117 Learning Objective: 6-3 Learning Objective: 6-4 Macro: 127 McConnell . d. B. b. b. real GDP will rise more rapidly than nominal GDP. GDP. 100. Environmental pollution is accounted for in: a.48. GDP will tend to increasingly understate the level of output through time. 200.Chapter 06 #160 Topic: 8 Type: Application of Concept . c. Econ: 119 Learning Objective: 6-5 Macro: 119 McConnell .

b. they do not take into account changes in the amount of leisure. of all of the above considerations.51. GDP data are criticized as being inaccurate measures of economic welfare because: a. c. they do not take into account the adverse effects of economic activity on the environment. they do not take into account all changes in product quality. . D.