choose the right answer!!! and expline in the math questions!!!! Which of the fo
ID: 1132813 • Letter: C
Question
choose the right answer!!! and expline in the math questions!!!!
Which of the following factors would be likely to affect the level of consumption spending?
A change in total household income
A change in consumer wealth, such as an increase in home values
A reduction in interest rates that makes consumer credit less expensive (cheaper to buy something on credit)
All of the above
QUESTION 2
What do economists call it when a firm's inventories increase because demand for its product turns out to be less than the firm expected?
Disinvestment
Unplanned inventory investment
Planned inventory investment
All of the above
QUESTION 3
Which of the following correctly states how to calculate GDP by the expenditure method?
The total value of all intermediate goods used in the production of final goods
Consumption plus investment plus government purchases plus net exports (exports minus imports)
Wages plus salaries plus interest income plus rental income plus profits
The value of all intermediate plus final goods and services
QUESTION 4
Shauna earned $1,000 last month and spent $600 of it on goods and services (consumption). This month she got a raise to $1,200 and she spent $700. What is Shauna's marginal propensity to consume?
0.6
0.5
0.7
0.583
QUESTION 5
Households in the country of Ecalpyna spent a total of $10,000 on goods and services last year. The Ecalpyna government purchased another $3,000 of goods and services. It also transferred $2,000 to Ecalpynans for health, retirement and unemployment benefits. Businesses in Ecalpyna invested a total of $2,500 in buildings and equipment. Ecalpyna exported $1,500 worth of goods and services to the rest of the world and imported $2,000 from other countries. What was Ecalpyna's GDP?
$15,000
$13,000
$17,000
There is not enough information provided to be able to tell.
QUESTION 6
Which of the following would not be included as consumption in calculating GDP?
You go to the supermarket and pay $100 cash for groceries for the week.
You pay your electric bill to KCP&L by direct debit from your checking account.
You pay for a haircut with a credit card.
You pay $200,000 for a house, using $160,000 borrowed from the bank and $40,000 from your family's savings.
QUESTION 7
Which of the following would be included in GDP/national income when using the income approach?
Compensation of employees (wages and benefits)
Rental income of persons
Corporate profits
All of the above
QUESTION 8
Which of the following components of accounts for the largest share of US GDP?
Consumption
Investment
Government purchases
Net exports
QUESTION 9
Which of the following is an example of a "transfer payment" that is not included in GDP?
The Federal Government transfers $1 billion to the State of Missouri for highway construction and maintenance.
You transfer $500 to the IRS to pay your federal income taxes.
You transfer $500 to your landlord's bank account to pay your rent.
Your grandmother receives a $2,000 monthly check for Social Security retirement benefits.
QUESTION 10
Barry's barbershop charged its customers $4,000 for haircuts last month. The shop collected $300 in sales taxes and remitted it to the government. It purchased $500 worth of supplies (haircare products, disposable razors, etc) used to provide haircuts. One of its electric clippers, worth $100, wore out during the month. Barry paid $1,500 in wages to his hair cutters and took $1,500 cash out of the business for himself. He set aside $400 for state, local and federal income taxes. What was the shop's contribution to gross domestic product for the month? (do not include dollar sign or comma in answer)
A change in total household income
A change in consumer wealth, such as an increase in home values
A reduction in interest rates that makes consumer credit less expensive (cheaper to buy something on credit)
All of the above
Explanation / Answer
1.
Consumption is directly dependent on total household income and indirectly on consumer wealth. A change in the rate of interest affects investment spending of the consumer.
the correct option is A
2.
When a firm's inventories increase because actual demand is less than the potential demand then it is called an unplanned inventory investment.
the correct option is B
3.
By expenditure method, GDP is calculated as consumption plus investment plus government spending plus net exports.
the correct option is B
4.
Marginal propensity to consume is the ratio of change in consumption divided by change in income.
=(700-600)/(1200-1000)
=1/2
=0.5
the correct option is B
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