Chapter 19 Macro Perspective

*Ch19 Macro Perspective*

*Multiple Choice Questions*

*1. *GDP is:

A. the sum of all currency and coins in circulation.
B. the value of all final goods and services produced by a government.
C. the value of all final good and services produced anywhere in the world by a nation’s firms.
D. the value of all final goods and services produced domestically.

Answer: D Reference:

Explanation:

Type: Multiple Choice

*2. *Final goods or services used to compute GDP refer to:

A. the sum of all wages paid to laborers.
B. the factors of production used to produce output.
C. goods and services purchased by the ultimate users.
D. the value of outstanding shares of stock of manufacturing firms.

Answer: C Reference:

Explanation:

Type: Multiple Choice

*3. *Consumption in the United States is about ____________ of GDP, and it moves relatively little over time.

A. 10%
B. 33%
C. 68%
D. 90%

Answer: C Reference:

Explanation:

Type: Multiple Choice

*4. *The demand measure of GDP accounting adds together:

A. wages and salaries, rent, interest, and profit.
B. consumption, investment, government purchases, and trade balance.
C. consumption, government purchases, wages and salaries, and trade balance.
D. consumption, interest, government purchases, and trade balance.

Answer: B Reference:

Explanation:

Type: Multiple Choice

*5. *Consumption is the purchase of goods and services by:

A. households.
B. government.
C. business firms.
D. foreign buyers.

Answer: A Reference:

Explanation:

Type: Multiple Choice

*6. *Which of the following are most likely classified by economists as consumer durable goods?

A. food, clothing
B. drugs, toys, magazines, books
C. automobiles, furniture
D. stocks, bonds

Answer: C Reference:

Explanation:

Type: Multiple Choice

*7. *Gross Domestic Product equals $1.2 trillion. If consumption equals $690 billion, investment equals $200 billion, and government spending equals $260 billion, then:

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