Question

(49)Which of the following statements is true?

GNP:

(a)Measures the total output of final goods and services within a country’s economy in a year

(b)Includes only goods and services produced by the citizens of a country

(c)Includes intermediate inputs

(d)All of the above

(50)Which of the following statements is false?

The monetary value of the output of $20 billion worth of cars by the Honda Corporation in India’s economy would be counted in:

(a)Japan’s GNP

(b)India’s GDP

(c)America’s GNP

(d)All of the above

(51)Suppose the GDP per capita of Bolivia was equal to US$650 and its GDP was equal to US$30 billion in 2019, which of the following represented Bolivia’s population in 2019:

(a)10 million

(b)8 million

(c)More information needed

(d)None of the above

(52)Which of the following is not a component of aggregate investment expenditures in a country’s GDP:

(a)Business investment expenditures

(b)Changes in inventories

(c)Durable consumption expenditures

(d)None of the above

(53)The market value of all final goods and services in an economy produced by resources owned by the nationals of that country:

(a)National income

(b)GDP

(c)GDP per Capita

(d)None of the above

(54)Which of the following activities is not considered part of US GDP accounts?

(a)Market value of surgeries

(b)Market value of cocaine

(c)Market value of steel

(d)Market value of perfumes

(55)Suppose the GDP is equal to $1580b, G=$470b, Ig=$260b, X=$8b, M=$5b, what is the value of C?

(a)$1265b

(b)$853b

(c)$847b

(d)None of the above

(56)Which of the following statements is true?

The GDP per capita and the GNP are called:

(a)Microeconomic aggregates

(b)International aggregates

(c)Macroeconomic indicators

(d)None of the above

(57)Which of the following statement is false?

If net export is positive in an economy, it implies that:

(a)GDP will increase

(b)There is a surplus on the BOT

(c)There is a deficit on the BOT

(d)The value of exports is greater than the value of imports

(58)Which of the following statements is false?

A country’s GDP is a:

(a)Measure of current production

(b)Measure of officially sanctioned market transactions

(c)Measure that excludes bartering transactions

(d)None of the above

(59)The US federal government adopted the GDP as a measure of the US economy in:

(a)1985

(b)1990

(c)1992

(d)2006

(60)Suppose a country’s GNP was equal to $860b and its Capital Consumption Allowances were equal to $80b in 2005, what would be the monetary value of its NDP?

(a)$650b

(b)$780b

(c)More information needed

(d)None of the above

Answer 1

40. GNP is the sum of the money value of goods and services produce by the citizens of a country within and outside of the economy.

Answer: b) includes only goods and services produced by the citizens of a country.

50) $20 billion worth of cars produced by the Honda Corporation in India is counted in the GDP of India and at the same time it is counted in Japan’s GNP.

Answer: c) America’s GNP.

51. Answer: d. none of the above.

52. c) Durable consumption expenditure.

53. National income is the sum total of factor incomes earned by normal residents of a country during the period of an accounting year.

Answer: a) National Income.

54. Illegal drugs are not included in the valuation of GDP.

Answer: b) market value of cocaine

55. GDP=C+I+G+Nx. To find consumption, minus the value of investment expenditure, government purchase and net export from the total value of GDP. Total expenditure = G$470b+Ig$260 + Nx$3= $733b. Then consumption= $1580b-$733b=$847b.

Answer: c) $847b

56. The GDP and GDP are macroeconomic variables.

Answer: c) macroeconomic indicators.

57. A positive net export means that there is more export and GDP will increase, BOT will be in surplus and the value of export is greater than import.

Answer: c) there is a deficit on the BOT.

58. GDP is the measure of current annual production, is a measure of all legal transactions and barter transactions are excluded from GDP.

Answer: d) none of the above.

59. U. S continue to use GNP as a measure of economic activity from 1944 to 1991. There after it switched to use GDP as a measure of economic growth.

Answer: c) 1992.

60. NDP refers to the market value of goods and services produced within the domestic territory of an economy during an accounting year excluding the depreciation. NDP= $860-$80b=$780b.

Answer: b) $780b.