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Exam 11: Measuring Macroeconomic Activity

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Question 1

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Macroeconomics studies the following topics:

A) national output, the inflation rate, and the trade deficit.
B) the price of Cisco stock and wage differences.
C) differences in market structure.
D) all of the above.

E) None of the above
F) A) and B)

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Question 2

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A measure of absolute price changes that excludes changes in energy and food prices is called:

A) fringe rate of inflation
B) core rate of inflation
C) overall inflation
D) none of the above

E) A) and D)
F) None of the above

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Question 3

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The following data summarize the expenditures for the country of XYZ during 2003 in millions of alphabet, the currency of country XYZ. $\begin{array}{|l|r|}\hline \text { Gross Private Domestic Investment } & \$ 300 \\\hline \text { Business Fixed Investment } & \$ 200 \\\hline \text { Change in Inventories } & \$ 100 \\\hline \text { Exports } & \$ 200 \\\hline \text { Imports } & \$ 200 \\\hline \text { Personal Consumption Expenditures } & \$ 800 \\\hline \begin{array}{l}\text { Government Consumption Expenditures and } \\\text { Gross Investment }\end{array} &\$ 500 \\\hline \text { StatisticalDiscrepancy } &\$ 10 \\\hline \text { Depreciation Expenditures } & \$ 50 \\\hline\end{array}$ a. Calculate net exports b. Calculate GDP c. Calculate national income d. Assume that the GDP deflator is 120 and calculate real GDP for 2003.

The producer price index measures:

Commodities that last less than three years and may be consumed very quickly are called:

In year one, the GDP deflator is 100 and in year two 110. If nominal GDP in year two is $300 billion, what is real GDP for year two?

If GDP rises,

Suppose an apartment complex is converted to an owner occupied condominium. Suppose that the estimated value of the condominium owners' housing services is now the same as their former rent.

Proprietor's income is not considered part of national income.

Those individuals 16 years of age and over who are working in a job or actively seeking employment are called:

In a circular-flow diagram, total income and total expenditures in an economy are:

The expenditure approach to calculating GDP for an open economy entails adding consumption, investment, and government purchases.

In a closed economy firms sell goods and services to:

What are some of the issues associated with the consumer price index?

The price of one currency in terms of another is called an exchange rate.

The rising phase of a business cycle measured by an increase in real GDP is called:

The value of currently produced final goods and services measured in constant prices is called:

Declining real GDP for two quarters in a row is often called a recession.

In recent years, U.S. exports have exceeded U.S. imports.

Which of the following is not included in GDP?