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1 | |
Canada's official GDP is calculated: |
| | A) | using the income approach, since the expenditure approach is too difficult to apply in practical situations. |
| | B) | using the expenditure approach, since the income approach is too difficult to apply in practical situations. |
| | C) | using the higher of the two estimates found using the income and expenditure approaches. |
| | D) | using the lower of the two estimates found using the income and expenditures approaches. |
| | E) | using both the income and expenditures approaches, with the concept of statistical discrepancy being applied to balance the two estimates. |
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2 | |
Which of the following is not included in the income approach to GDP? |
| | A) | proprietors' incomes and rents |
| | B) | wage and salaries |
| | C) | direct taxes |
| | D) | corporate profits |
| | E) | depreciation |
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3 | |
Identify the intermediate product from the goods listed below: |
| | A) | a hamburger bought for lunch by an office clerk |
| | B) | coffee beans purchased by a coffee shop |
| | C) | a tractor bought by a farmer |
| | D) | flour purchased by a homemaker to make bread |
| | E) | a submarine purchased by a government department |
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4 | |
To avoid the problem of double counting in the calculation of GDP, national income accountants: |
| | A) | deduct the total value of intermediate products from the total value of final products. |
| | B) | include only intermediate products. |
| | C) | deduct the total value of intermediate products from total resource incomes. |
| | D) | count only the value added at each stage of production. |
| | E) | deduct the total value of final products from the total value of intermediate products. |
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5 | |
Which of the following transactions is not included in GDP? |
| | A) | A government worker receives a paycheque. |
| | B) | A music store buys 100 CDs to add to its inventories. |
| | C) | A financial investor buys 100 shares of a Canadian corporation. |
| | D) | A student purchases a magazine. |
| | E) | A firm buys a piece of software. |
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6 | |
Which of the following is not included in the expenditure approach to GDP? |
| | A) | government transfer payments |
| | B) | personal consumption |
| | C) | net exports |
| | D) | gross investment |
| | E) | government purchases. |
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7 | |
When a country's capital stock is growing: |
| | A) | net investment exceeds gross investment. |
| | B) | net investment is positive. |
| | C) | gross investment is positive. |
| | D) | gross investment exceeds net investment. |
| | E) | gross investment is negative. |
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8 | |
Gross investment: |
| | A) | is always financed out of investment funds. |
| | B) | is always nanced out of retained earnings. |
| | C) | is financed out of both investment funds and retained earnings. |
| | D) | excludes changes in inventories. |
| | E) | excludes depreciation of existing capital assets. |
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9 | |
To compare living standards in the same country in different years, the indicator that is used is: |
| | A) | GDP. |
| | B) | real GDP. |
| | C) | per capita GDP. |
| | D) | per capita real GDP. |
| | E) | GDP expressed US dollars. |
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10 | |
To compare living standards in different countries at the same time, an indicator that is often used is: |
| | A) | per capita GDP expressed in the each of the countries' own currencies. |
| | B) | per capita real GDP expressed in each of the countries' own currencies. |
| | C) | per capita GDP expressed in US dollars. |
| | D) | GDP expressed in US dollars. |
| | E) | GDP expressed in each of the countries' own currencies. |
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11 | |
GDP can: |
| | A) | understate gains in Canadian economic well-being, because it does not take into account greater amounts of leisure. |
| | B) | understate gains in economic well-being, since it does not take into account the growth in the underground economy. |
| | C) | overstate gains in Canadian economic well-being, given that it does not include the environtmental damage. |
| | D) | understate gains in Canadian economic well-being, because it does not reflect increases in product quality. |
| | E) | all of the above |
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12 | |
The total income acquired by Canadians both within Canada and elsewhere is known as: |
| | A) | gross domestic product (or GDP). |
| | B) | gross national product (or GNP). |
| | C) | net domestic income (or NDI). |
| | D) | personal income (PI). |
| | E) | disposable income (DI). |
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13 | |
The income earned by households supplying resources in Canada is known as: |
| | A) | gross domestic product (or GDP). |
| | B) | gross national product (or GNP). |
| | C) | net domestic income (or NDI). |
| | D) | personal income (PI). |
| | E) | disposable income (DI). |
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14 | |
The income actually received by Canadian households is known as: |
| | A) | gross domestic product (or GDP). |
| | B) | gross national product (or GNP). |
| | C) | net domestic income (or NDI). |
| | D) | personal income (PI). |
| | E) | disposable income (DI). |
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15 | |
Household income minus personal taxes and other transfers to government is known as: |
| | A) | gross domestic product (or GDP). |
| | B) | gross national product (or GNP). |
| | C) | net domestic income (or NDI). |
| | D) | personal income (PI). |
| | E) | disposable income (DI). |
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16 | |
The Human Development Index designed by Mahbub ul Haq |
| | A) | includes per capita GDP measured in each country's currency. |
| | B) | includes per capita GDP adjusted for purchasing power parity. |
| | C) | includes the infant mortality rate for each country. |
| | D) | includes a measure of environmental quality for each country. |
| | E) | includes a measure of the equality of the distribution of income in each country. |
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2002 McGraw-Hill Higher Education