Investment is a _______________ that ______________ the _____________ of capital.

stock; increases; flow
flow; adds to; flow
stock; decreases; stock
flow; increases; stock

When _______ is greater than _______, saving increases _______.

income; consumption expenditure; wealth
income; government purchases; wealth
consumption expenditure; government purchases; wealth
income; consumption expenditure; investment

If the government budget is balanced and investment is equal to saving, then _________________.

the country does not trade international.
net exports are positive
net exports are negative
exports equal imports

Which of the following items is not a component of the expenditure approach to measuring U.S. GDP?

social security payments made by the government
purchases of U.S.-made aircraft by Europeans
purchases of new computers by businesses and farms
purchases made by families

Which of the following items is not a component of the income approach to measuring U.S. GDP?

interest earned on savings deposits
profits made by businesses
income earned by businesses that export goods
investment

Which of the following items are counted in GDP? A taxi company's ________________________.

sale of some bonds to finance its purchases
purchase of new trip meters for its cabs
sale of 5 old cabs
purchase of 5 new cabs

GDP equals all of the following except ___________________________.

aggregate expenditure
aggregate production
aggregate income
aggregate purchases of goods and services

One year after the base year, deflation occurs. In this year, nominal GDP is ____________ real GDP, and the GDP deflator is _____________.

less than; greater than 100
equal to; equal to 10
greater than; greater than 100
less than; less than 100

If the price of one good in the CPI basket increases and people switch to a lower-priced substitute that is not in the CPI basket, then the price level measured by the CPI _______________________.

is the same as the actual price level
might be either higher or lower than the actual price
is lower than the actual price level
is higher than the actual price level

Real GDP is not a good indicator of economic welfare because it ________________________.

excludes the underground economy
measures the value of time spent working but not the value of leisure time
does not include the pollution created by steel mills
all the above

Please enter your name and press the SEND button