Economic Indicators

Which of the following is the most effective tool that economists use in determining the wealth of a country?

• Net Personal Income

• Unemployment Rate

• Gross National Product (GNP)

• Gross Domestic Product (GDP)

Which of the following is the best definition for GDP?

• It is all the value of a given nation, divided by the number of citizens in the country.

• It is the total wealth that all citizens in a country own, after taxes.

• It is the total value of all final goods and services produced in a country at a given time.

• It is the total amount that workers are paid throughout a nation.

Which of the following is not a flaw of GDP?

• It is not reliable and can make false predictions.

• It is based on old information due to taking a long time to gather data needed.

• Does not measure the standard of living.

• Does not look at nonmarket activities, like self home improvement.

Which of the following is not an economic indicator that can be used to gauge the wealth of a nation?

• Gross National Product

• Net National Product

• Disposable Personal Income

• Income Tax Payments

At what point in the business cycle will companies see a decline in GDP, which could result in economic pain for them?

• Peak

• Expansion

• Trough

• Contraction

The GDP formula for the US is as follows: US GDP=70%+18%+17%-5%. Which of the following statements is true, based on this formula?

• The US exports more goods than we import.

• The US heavily relies on personal consumption to keep the economy going.

• The US is a net exporter and relies on it to make some extra money.

• Government spending is greater than business investments in the US.

What is the term used to describe a contraction that lasts around 6 months?

• Severe Contraction

• Recession

• Depression

• Stagflation

What is the difference between aggregate demand/ supply and regular supply and demand.

• Regular demand/supply has no equilibrium point.

• Regular demand/supply is focused on global economic supply and demand.

• Aggregate demand/supply looks at the economic output and prices of an entire industry or nation.

• Aggregate demand/supply only looks at one good or service produced.

If aggregate supply increases, what will happen to GDP?

• GDP will decrease.

• GDP will increase.

• GDP will remain the same.

If aggregate demand decreases, what will happen to GDP?

• GDP will decrease

• GDP will increase

• GDP will remain the same.