Econ 212 Exam 1 || WITH PASSED SOLUTIONS!!
National Income and National Expenditure must always be equal.
True or False correct answers true
As depicted in the circular flow diagram, which of the following are considered factors of
production (i.e. inputs)? correct answers Capital
Match the factors of production with their corresponding factor payments.
Land
Labor
Capital correct answers rents
wages
profits
Gross Domestic Product (GDP) is the market value of all final goods and services produced
in a given nation in a given year. correct answers Answer 1 Market Value
Answer 2 Goods and Services
Suppose that an isolated island pays its workers $700 in total wages, and capital owners $160
in total profits. If the GDP of this island is $1,100, what is the value of rental payments paid
to land owners?
Round all answers to the nearest whole number and do not include a dollar sign or decimal in
your answer (for example, $375.00 should be entered as 375) correct answers 240
Match each of the following with the appropriate classification:
Hair Cut
Pizza Purchased For Dinner
Lumber Purchased by Construction Company
Used car Purchased by Student correct answers Service
Final Good
Intermediate Good
Not Included in GDP
Match each expenditure to its corresponding GDP component:
, Sale of Boeing 747 to Brazilian Airline
Construction of office tower in Manhattan
Purchase of dinner at local restaurant
electricity consumption at FBI headquarters
Purchase of korean tv correct answers Export
Investment
Consumption
Government
Both Import and consumption
If GDP equals $14,000 billion, government expenditures (G) equal $2,800 billion, investment
(I) equals $2,000 billion, imports (IM) equal $1,000, and exports (EX) equal $1,000, what is
the value of consumption (C)? correct answers 9200 BILLION
Suppose that Congress increases Social Security benefits by $50 billion this year. How much
will the government expenditures (G) component of GDP change? correct answers 0
If a nation's imports total $300 billion and that nation runs a trade deficit of $100 billion,
what is the size of that nation's exports? correct answers 200 billion
Which component of GDP is the largest? correct answers Consumption
Which component of GDP is the smallest? correct answers Net Exports
For the past 25 years, consumption represents approximately what proportion of GDP (i.e.
C/Y)? correct answers 70%
Nominal GDP calculates the value of a nation's output at current prices while Real GDP
calculates the value of a nation's output using constant prices. correct answers Answer 1
current
Answer 2 constant
If your goal is to calculate the growth of a nation's output over a ten year period, you should
calculate the percentage change in Real GDP over that period. correct answers Real
Using the drop-down menus, select the missing values below. For the Real GDP calculation,
set the base year equal to 2015.
Chips Salsa Nominal Real
Year Quantity Price Quantity Price GDP GDP
National Income and National Expenditure must always be equal.
True or False correct answers true
As depicted in the circular flow diagram, which of the following are considered factors of
production (i.e. inputs)? correct answers Capital
Match the factors of production with their corresponding factor payments.
Land
Labor
Capital correct answers rents
wages
profits
Gross Domestic Product (GDP) is the market value of all final goods and services produced
in a given nation in a given year. correct answers Answer 1 Market Value
Answer 2 Goods and Services
Suppose that an isolated island pays its workers $700 in total wages, and capital owners $160
in total profits. If the GDP of this island is $1,100, what is the value of rental payments paid
to land owners?
Round all answers to the nearest whole number and do not include a dollar sign or decimal in
your answer (for example, $375.00 should be entered as 375) correct answers 240
Match each of the following with the appropriate classification:
Hair Cut
Pizza Purchased For Dinner
Lumber Purchased by Construction Company
Used car Purchased by Student correct answers Service
Final Good
Intermediate Good
Not Included in GDP
Match each expenditure to its corresponding GDP component:
, Sale of Boeing 747 to Brazilian Airline
Construction of office tower in Manhattan
Purchase of dinner at local restaurant
electricity consumption at FBI headquarters
Purchase of korean tv correct answers Export
Investment
Consumption
Government
Both Import and consumption
If GDP equals $14,000 billion, government expenditures (G) equal $2,800 billion, investment
(I) equals $2,000 billion, imports (IM) equal $1,000, and exports (EX) equal $1,000, what is
the value of consumption (C)? correct answers 9200 BILLION
Suppose that Congress increases Social Security benefits by $50 billion this year. How much
will the government expenditures (G) component of GDP change? correct answers 0
If a nation's imports total $300 billion and that nation runs a trade deficit of $100 billion,
what is the size of that nation's exports? correct answers 200 billion
Which component of GDP is the largest? correct answers Consumption
Which component of GDP is the smallest? correct answers Net Exports
For the past 25 years, consumption represents approximately what proportion of GDP (i.e.
C/Y)? correct answers 70%
Nominal GDP calculates the value of a nation's output at current prices while Real GDP
calculates the value of a nation's output using constant prices. correct answers Answer 1
current
Answer 2 constant
If your goal is to calculate the growth of a nation's output over a ten year period, you should
calculate the percentage change in Real GDP over that period. correct answers Real
Using the drop-down menus, select the missing values below. For the Real GDP calculation,
set the base year equal to 2015.
Chips Salsa Nominal Real
Year Quantity Price Quantity Price GDP GDP
