1 / 16

Understanding GDP: The Measure of Economic Activity

Dive into the concept of GDP, exploring its calculation, significance, and approaches for measurement, including clicker questions and detailed answers.

orson-case
Download Presentation

Understanding GDP: The Measure of Economic Activity

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. GDP: A Measure of Total production and Income 5 CLICKER QUESTIONS

  2. Checkpoint 5.1 Checkpoint 5.2 Appendix Checkpoint Question 1 Question 5 Question A1 Question 6 Question 2 Question A2 Question 7 Question 3 Question A3 Checkpoint 5.3 Question 4 Question 8 Question 9 Question 10

  3. CHECKPOINT 5.1 Question 1 Which of the following goods is not a final good? • Flour used by the baker to make cup cakes. • Bread eaten by a family for lunch. • Pencils used by a 6th grader in class. • Nike shoes used by a basketball player. • A computer used by Intel to design new computer chips.

  4. CHECKPOINT 5.1 Question 2 Investment includes ________. • the purchase of a stock or bond • an increase in financial capital • what consumers do with their savings • the purchase of new capital goods by firms • spending on capital goods by governments

  5. CHECKPOINT 5.1 Question 3 GDP is equal to the ____ value of ____ goods and services produced within a country in a given period of time. • production; all • market; all final • wholesale; all intermediate • retail; all • market; all

  6. CHECKPOINT 5.1 Question 4 In 2010, one firm increases its production by $9 million and its sales increases by $8 million. With other things remaining the same, in 2010 ________. • GDP increases by $8 million and inventory investment decreases by $1 million • GDP increases by $9 million and inventory investment increases by $1 million • inventory investment decreases by $1 million • GDP increases by $8 million and investment increases by $1 million • GDP increases by $17 million

  7. CHECKPOINT 5.2 Question 5 Using the expenditure approach, GDP is the sum of _____. • wages, interest, rent, and profit • all industry production • the value of all final and intermediate goods and services. • consumption expenditure, investment, government expenditure on goods and services, and net exports • consumption expenditure, investment, government expenditure, and the change in financial assets

  8. CHECKPOINT 5.2 Question 6 The income approach to measuring GDP does not include ______. • wages paid workers • rent received by landlords • interest earned by savers • Income taxes paid by persons • profit made by firms

  9. CHECKPOINT 5.2 Question 7 The difference between nominal GDP and real GDP is ___. • the indirect taxes used in their calculations • the prices used in their calculations • that nominal GDP includes the depreciation of capital and real GDP does not • that nominal GDP includes net exports and real GDP does not • that real GDP includes the depreciation of capital and nominal GDP does not

  10. CHECKPOINT 5.3 Question 8 Real GDP ____ potential GDP when the economy ____ of the business cycle. • is less than; is at the peak • exceeds; is in a recession and near to the trough • is less than; begins an expansion phase • exceeds; leaves the trough and an expansion phase starts • equals; is in the expansion phase

  11. CHECKPOINT 5.3 Question 9 You hire some friends to help you move to a new house. You pay them $200 and buy them dinner at Pizza Hut. • The $200 should be counted as part of GDP but not the dinner • If your friends do not declare the $200 as taxable income, it becomes part of the underground economy. • The dinner is counted as part of GDP but the $200 should not be. • The $200 paid to friends should not be counted in GDP. • Both the $200 and the dinner should be counted in GDP because they are part of household production.

  12. CHECKPOINT 5.3 Question 10 The value of leisure time is ________. • included in GDP and, in recent years, has become an increasing large part of GDP • personal and has no economic value • excluded from GDP • directly included in GDP but, in recent years, has become a decreasing large part of GDP • directly included in GDP and, in recent years, has not changed much as a fraction of GDP

  13. APPENDIX CHECKPOINT Question A1 Real GDP measures the value of goods and services produced in a given year valued using ________. • base year prices • prices of that same year • no prices • future prices • government approved prices

  14. APPENDIX CHECKPOINT Question A2 In a country, using prices of 2010, GDP in 2010 was $100 and GDP in 2011 was $110. Using prices of 2011, GDP in 2010 was $200 and GDP in 2011 was $210. The country’s BEA will report that real GDP grew by ______in 2011 . • 10 percent • 5 percent • 15 percent • 7.5 percent • more than 20 percent

  15. APPENDIX CHECKPOINT Question A3 In the base year 2009, real GDP was $10 trillion. Using 2009 prices, GDP in 2010 grew by 10 percent; using 2011 prices, GDP in 2010 grew by 8 percent. To link to the base year, the BEA will use ____ percent as the growth in real GDP in 2010 and report real GDP in 2010 as _______. • 10; $11 trillion • 8; $11 trillion • 2; $10.2 trillion • 18; $11.8 trillion • 9; $10.9 trillion

More Related