Econ 202 Exam 1 Questions with Complete Correct Answers | Grade A+

Y is Ans: GDP C is Ans: consumption I is Ans: investment G is Ans: Government expenditure NX is Ans: net export NX equals Ans: export - import (NX = X-M) GDP Equation Ans: Y = C + I + G + NX Value added approach GDP Ans: market value of all final goods and services produced within a country in a given period of time (FINAL MARKET VALUE is the orange juice itself, NOT the oranges and ingredients that make it) Inventory - goods produced to be sold are Ans: investments Nominal GDP uses Ans: current years market prices Real GDP uses Ans: market prices of a base year from the past Nominal GDP is not used for inflation but real GDP is correct for inflation (true or false) Ans: True Nominal and real of base year is always the same (rewrite) Ans: Nominal and real of base year is always the same Real GDP growth rate Ans: Real GDP current year - Real GDP previous year / real GDP previous year x 100 (Graph) Why is nominal GDP in 2009 greater than real GDP of 2009? Ans: Market prices of 2009 are greater than market prices of 2005 When will nominal GDP and real GDP for 2018 be the exact same? (Base year 2005) Ans: When the prices are the same as 2005 (base year) Assume in 2019, GDP Deflator is less than 100. What does this mean? Ans: Means prices in 2019 were less than prices in 2005 (base year) Real interest rate is Ans: increase in purchasing powe