Macroeconomics Quiz test 02

-30 Multiple Choice Questions at the University Level

1. What does the national income measure?

a) The total economic output and income generated within a country's borders
b) The gross domestic product of a country
c) The net exports of a country
d) The total population of a country
Answer: a

2. Which of these is not a component of national income?

a) Wages
b) Salaries
c) Profits
d) Population growth
Answer: d

3. What does Gross Domestic Product (GDP) include?

a) Consumption, investment, government spending, and net exports
b) Only consumption and investment
c) Only government spending and net exports
d) None of the above
Answer: a

4. What is Gross National Product (GNP)?

a) Total value of goods and services produced domestically only
b) Total value of all goods and services produced by a country's residents, whether domestically
or abroad.
c) Total value of all goods and services produced abroad only.
d) None of the above.
Answer: b

5. How is Net National Product (NNP) calculated?

a) GNP plus depreciation
b) GDP plus depreciation
c) GNP minus depreciation
d) GDP minus depreciation
Answer: c

6. Per capita income is an indicator of what?

a) The overall standard of living in a country.
b} The overall population size in a country.
c} The overall national debt in a country.
d} None of the above.
Answer: a
7. What does the growth rate measure?
a. Economic performance over time for specific economic indicators.
b. Population growth over time.
c. Inflation rate over time.
d. Unemployment rate over time.
Answer: A

8.What are some essential tools for understanding a country's economic health?
a.GDP, GNP, NNP and Per Capita Income indicators
b.Population demographics
c.Technological advancements
d.All the above
Answer: d

9.What is the formula for calculating National Income?

a.Y = C + I + G + NX
b.Y = S + C
c.Y = TR - TA
d.None Above
Answer: A

10.What does Consumption(C), in National Income Equation represent?

a.Spending by businesses on capital goods and structures
b.Spending by households on goods and services
c.Public expenditures on goods and services
d.Difference between exports and imports
Answer:B

11.How can Personal Income be expressed?

a.Y = S + C
b.Y = C + I + G + NX
c.Y = TR - TA
d.None Above
Answer:A

12.What do equations used in macroeconomics describe?

a.Income distribution
b.Consumption
c.Economic activity
d.All Above
Answer:D

13.How can National Income be represented based on sources?

a.Y = TR - TA
b.Y = S - I
c.Y = C + I
d.None Above
Answer:A

14.What are Total Receipts(TR), in National Income Equation?

a.Income sources like wages,salaries,profits,government transfers
b.Taxes paid by individuals
c.Spending by individuals on goods/services
d.None Above
Answer:A

15.What is the Saving-Investment Identity with Government and Net Exports equation?
A .S-I=G+TR-TA+NX
B .Y=C+I+G+NX
C .Y=TR-TA
D .None Above
ANSWER : A

16.What does Real GDP represents ?

A .The total value of all goods/services produced within countries border at current price levels
B .The total value of all goods/services produced adjusted for changes in price levels using base
year prices
C .Both A & B
D .None above
ANSWER : B

17.Which one reflects changes in production holding prices constant ?

A .Nominal GDP
B .Real GDP
C .Both Nominal & Real GDP
D .None above
ANSWER : B

18.Which one cannot be directly compared overtime due to price changes ?

A.Nominal GDP
B.Real GDP
C.CPI(D).None above
ANSWER : A
19.Investment as factors affecting growth rate means ?
A.Higher level investments leads to decreased productivity
B.Higher level investments leads to increased productivity
C.Low level investments leads to increased productivity
D.None above
ANSWER : B

20.Technological progress as factors affecting growth rate means ?

A.Advances technology drive innovation ,improves productivity & opens up new opportunities
for growth
B.Advances technology drive innovation ,decreases productivity & closes up new opportunities
for growth
C.Advances