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If all other factors are held constant, an increase in imports A) causes an increase in

If all other factors are held constant, an increase in imports A) causes an increase in

 If all other factors are held constant, an increase in imports

A) causes an increase in exports of the same size.

B) causes GDP to increase.

C) causes GDP to decrease.

D) can cause GDP to increase or decrease, depending on whether the imports are purchased by consumers or by business firms.

52) If GDP equals $1 billion, investment expenditures are $200 million, exports equal imports, and government spending is $400 million, then

A) consumption expenditures are $200 million.

B) consumption expenditures are $400 million.

C) spending on consumer durables must be $400 billion.

D) we cannot determine what expenditures on consumption are without more information.

 

53) If imports are $100 million less than exports, government spending is $500 million, consumer expenditures are $1 billion, and investment spending is $500 million, then GDP is

A) $1 billion.

B) $1.9 billion.

C) $2 billion.

D) $2.1 billion.

 

54) If consumption expenditures are $500 million, spending on fixed investment is $100 million, the increase in inventories equals $5 million, imports are $50 million, exports are $55 million, government spending on goods and services is $200 million, than GDP is

A) $790 million.

B) $800 million.

C) $810 million.

D) $830 million.

55) If consumption expenditures are $100 million, net investment is $50 million, imports are $20 million, exports are $10 million, government spending on goods and services is $40 million, social security spending is $15 million, and sales of existing homes equals $40 million, then what is the measure of GDP?

A) GDP = $225 million

B) GDP = $180 million

C) GDP = $295 million

D) GDP = $195 million

 

56) The value of GDP, when estimated by the income approach, is the sum of

A) consumption expenditures, investment spending, and profits.

B) consumption, wages, rents, interest, and profits.

C) income earned by all factors of production.

D) depreciation, indirect business taxes, and income earned by the factors of production.

Table 5-3

 

Net interest$239

Federal government purchase136

Wages and salaries1,735

Rental income37

 

Personal transfer

Change in business payments262

Inventories14

 

Personal consumption

proprietors income128

Expenditures1,479

Indirect business Corporate profits194

Taxes259

Exports249

Depreciation333

 

57) According to Table 5-3, gross domestic product as calculated by the income approach is

A) $2,592 billion.

B) $2,819 billion.

C) $2,925 billion.

D) $2,205 billion.

 

58) According to Table 5-3, net domestic product is

A) $2,259 billion.

B) $2,592 billion.

C) $1,872 billion.

D) $2,486 billion.

59) According to Table 5-3, national income is

A) $2,333 billion.

B) $2,259 billion.

C) $2,486 billion.

D) $1,872 billion.

 

Table 5-4

 

Indirect Business Taxes$200

Gross Corporate Profits plus Proprietors' Income$640

Rental Income (including implicit rents)$375

Net Interest$50

Depreciation (capital consumption allowance)$275

Wage and Salary Income$2,200

 

60) According to Table 5-4, gross domestic product is

A) $3,740.

B) $3,640.

C) $2,750.

D) $3,550.

Abhinav 07-Dec-2019

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