Macroeconomics ECN211 Midterm Review Exam
LATEST 2026/2027 Questions and Verified Answers
(GUARANTEED PASS)
When a consumer purchases a new computer, how is that purchase
counted in GDP?
A. by adding the value of the various components of the computer to the
final price paid for the computer by the consumer.
B. by subtracting the value of the components from the price paid by the
consumer.
C. by counting only the value of the computer and ignoring the value of the
components.
D. None of the above. The production and sale of the computer would not
be counted in GDP. - VERIFIED ANSWER - C. by counting only the value of
the computer and ignoring the value of the components.
Which of the following is counted in this year's GDP?
A. only this year's production of goods and services.
B. only goods that are both produced and sold within the United States.
C. new goods produced and sold this year plus the value of used goods
resold this year.
,D. this year's production of goods and services added to the value of GDP
last year. - VERIFIED ANSWER - A. only this year's production of goods and
services.
If we add up the value of every good and service produced in the
economy, we get a total that is:
A. larger than GDP.
B. smaller than GDP.
C. equal to GDP.
D. larger or smaller than GDP depending on whether the economy
experiences inflation during the year. - VERIFIED ANSWER - A. larger than
GDP.
If we add up the value of every final good and service produced in the
economy, we must get a total that is exactly equal to the value of:
A. investment.
B. net national product.
C. disposable personal income.
D. all of the income in the economy. - VERIFIED ANSWER - D. all of the
income in the economy.
,Which of the following would be considered a factor of production?
A. capital
B. natural resources
C. entrepreneurship
D. all of the above - VERIFIED ANSWER - D. all of the above
In the circular-flow diagram, who supplies factors of production in
exchange for income?
A. households
B. firms
C. the government
D. all of the above - VERIFIED ANSWER - A. households
Complete the following sentence: Total income in the economy equals the
sum of wages, interest, ____________ and ____________.
A. dividends, transfer payments
B. rent, profit
C. taxes, transfer payments
D. disposable income, net exports - VERIFIED ANSWER - B. rent, profit
, The flow of funds from _______________ into the financial system makes
it possible for government and firms to borrow.
A. governments and firms
B. households
C. investment banks
D. exports - VERIFIED ANSWER - B. households
An important conclusion to draw from the circular-flow diagram is that:
A. personal consumption expenditures are equal to the value of GDP.
B. only the value of total income equals the value of GDP, not the value of
expenditures.
C. only the total value of expenditures equals the value of GDP, not the
value of income.
D. we can measure GDP by calculating the total value of expenditures on
final goods and services, or we can measure GDP by calculating the value
of total income. - VERIFIED ANSWER - D. we can measure GDP by
calculating the total value of expenditures on final goods and services, or
we can measure GDP by calculating the value of total income.
Which of the following is true about the consumption component of U.S.
GDP in 2008?
LATEST 2026/2027 Questions and Verified Answers
(GUARANTEED PASS)
When a consumer purchases a new computer, how is that purchase
counted in GDP?
A. by adding the value of the various components of the computer to the
final price paid for the computer by the consumer.
B. by subtracting the value of the components from the price paid by the
consumer.
C. by counting only the value of the computer and ignoring the value of the
components.
D. None of the above. The production and sale of the computer would not
be counted in GDP. - VERIFIED ANSWER - C. by counting only the value of
the computer and ignoring the value of the components.
Which of the following is counted in this year's GDP?
A. only this year's production of goods and services.
B. only goods that are both produced and sold within the United States.
C. new goods produced and sold this year plus the value of used goods
resold this year.
,D. this year's production of goods and services added to the value of GDP
last year. - VERIFIED ANSWER - A. only this year's production of goods and
services.
If we add up the value of every good and service produced in the
economy, we get a total that is:
A. larger than GDP.
B. smaller than GDP.
C. equal to GDP.
D. larger or smaller than GDP depending on whether the economy
experiences inflation during the year. - VERIFIED ANSWER - A. larger than
GDP.
If we add up the value of every final good and service produced in the
economy, we must get a total that is exactly equal to the value of:
A. investment.
B. net national product.
C. disposable personal income.
D. all of the income in the economy. - VERIFIED ANSWER - D. all of the
income in the economy.
,Which of the following would be considered a factor of production?
A. capital
B. natural resources
C. entrepreneurship
D. all of the above - VERIFIED ANSWER - D. all of the above
In the circular-flow diagram, who supplies factors of production in
exchange for income?
A. households
B. firms
C. the government
D. all of the above - VERIFIED ANSWER - A. households
Complete the following sentence: Total income in the economy equals the
sum of wages, interest, ____________ and ____________.
A. dividends, transfer payments
B. rent, profit
C. taxes, transfer payments
D. disposable income, net exports - VERIFIED ANSWER - B. rent, profit
, The flow of funds from _______________ into the financial system makes
it possible for government and firms to borrow.
A. governments and firms
B. households
C. investment banks
D. exports - VERIFIED ANSWER - B. households
An important conclusion to draw from the circular-flow diagram is that:
A. personal consumption expenditures are equal to the value of GDP.
B. only the value of total income equals the value of GDP, not the value of
expenditures.
C. only the total value of expenditures equals the value of GDP, not the
value of income.
D. we can measure GDP by calculating the total value of expenditures on
final goods and services, or we can measure GDP by calculating the value
of total income. - VERIFIED ANSWER - D. we can measure GDP by
calculating the total value of expenditures on final goods and services, or
we can measure GDP by calculating the value of total income.
Which of the following is true about the consumption component of U.S.
GDP in 2008?
