# If total consumption is \$5 billion investments \$2 billion government purchases \$1 billion exports \$1 billion and imports \$3 billion

### If total consumption is \$5 billion investments \$2 billion government purchases \$1 billion exports \$1 billion and imports \$3 billion

If total consumption is \$5 billion, investments \$2 billion, government purchases \$1 billion, exports \$1 billion, and imports \$3 billion, the GDP must equal:

A. \$6 billion.

B. \$12 billion.

C. \$9 billion.

D. \$3 billion.

93.If consumption is \$8 billion, investments is \$4 billion, government purchases are \$2 billion, imports are \$1 billion, and exports are \$2 billion, GDP must equal:

A. \$16.

B. \$17.

C. \$15.

D. \$14.

94.If consumption is \$6 billion, investment is \$3 billion, government purchases are \$1 billion, and GDP is \$12 billion, then net exports must equal:

A. \$22 billion.

B. \$10 billion.

C. \$2 billion.

D. \$12 billion.

95.If imports are \$4 billion and net exports are \$4 billion, what must be the value of exports?

A. \$0 billion

B. \$8 billion

C. \$4 billion

D. \$2 billion

96.In a simple closed economy, the income approach to calculating GDP is:

A. wages + interest + rental income + profits.

B. wages + interest + government income + profits

C. wages + government - earned interest + rental income + profits

D. None of these is correct.

97.The difference between the sale value of the product and the value of the inputs that went into it is called:

A. the value-added of that stage of production.

B. the value of the final product.

C. the profit margin.

D. None of these is correct.

98.The value-added approach of calculating GDP:

A. is an alternative, and equally valid, way of avoiding the problem of double-counting.

B. lets us break down the total value paid and see how much of it was created at each step of the production process.

C. is especially useful when thinking about services involved in the resale of existing goods.

D. All of these are correct.

99.Which approach to calculating GDP would be best to compare consumer activity versus government purchases?

A. The expenditure approach

B. The income approach

D. Any of these measurements will allow that comparison equally well.

100.Which approach to calculating GDP best highlights the relative importance of different factors of production?

A. The expenditure approach

B. The income approach Get solution