ECON 1100 EXAM 280 QUESTIONS & CORRECT
ANSWERS LATEST 2025
The nominal GDP of Canada in 2015 was approximately $1.99 trillion. This means
that
A) the value of output in 2015 was around $1.99 trillion.
B) total spending in 2015 was around $1.99 trillion.
C) total income in 2015 was around $1.99 trillion.
D) All of the above are true. - ANSWER-D) All of the above are true.
Table 4.4
Consumption expenditures $800
Investment expenditures 300
Government purchases 300
Government transfer payments 400
Exports 300
Imports 100
Refer to Table 4.4. Consider the data above (in billions of dollars) for an economy:
Based on the expenditure approach in macroeconomic models, gross domestic
product (in billions of dollars) for this economy equals
A) $2,200
B) $2,100
C) $1,600
D) $1,400
,E) $800. - ANSWER-C) $1,600
Gross domestic product understates the total production of final goods and services
because of the omission of
A) imports.
B) household production.
C) inflation.
D) intermediate goods.
E) exports. - ANSWER-B) household production.
Real GDP will increase
A) only if the price level rises.
B) only if the quantity of final goods and services produced rises.
C) only if the price level falls.
D) when nominal GDP falls.
E) if either the price level rises or the quantity of final goods and services produced
rises. - ANSWER-B) only if the quantity of final goods and services produced
rises.
Gross national income is defined as
A) the value of final goods and services produced outside of Canada.
B) the value of intermediate goods and services produced within Canada.
C) the value of final goods and services produced within Canada, by Canadian
residents.
D) the value of final goods and services produced within Canada.
,E) the value of payments received by Canadians for their factors of production
even if the production takes place outside of Canada. - ANSWER-C) the value of
final goods and services produced within Canada, by Canadian residents.
The ________ is a measure of the price level and is calculated by dividing
________ by ________ and multiplying by 100.
A) GDP deflator; real GDP; nominal GDP
B) GDP deflator; nominal GDP; real GDP
C) PPI; real GDP; nominal GDP
D) PPI; nominal GDP; real GDP
E) CPI; real GDP; nominal GDP - ANSWER-B) GDP deflator; nominal GDP; real
GDP
The labour force equals the number of people
A) employed.
B) in the entire country.
C) in the working-age population.
D) unemployed.
E) employed plus unemployed. - ANSWER-E) employed plus unemployed.
The natural rate of unemployment is the amount of unemployment
A) that exists when the economy goes into recession.
B) equal to frictional and cyclical unemployment.
C) that exists when the economy is in an expansion.
D) equal to seasonal and cyclical unemployment.
E) equal to frictional plus structural unemployment. - ANSWER-E) equal to
frictional plus structural unemployment.
, Which of the following policies would reduce structural unemployment?
A) a job retraining program
B) expanding employment insurance to cover more workers
C) building an online job database that helps workers find jobs
D) a government spending program designed to shorten recessions
E) an increase in the minimum wage - ANSWER-A) a job retraining program
A consumer price index of 160 in 2017 with a base year of 2002 would mean that
the cost of the market basket
A) equaled $160 in 2017.
B) rose 160% from the cost of the market basket in the base year.
C) equaled $160 in 2002.
D) rose 60% from the cost of the market basket in the base year.
E) is 160 times more than it cost in 2002. - ANSWER-D) rose 60% from the cost
of the market basket in the base year.
Imagine that you borrow $1,000 for one year and at the end of the year you repay
the $1,000 plus $100 of interest. If the inflation rate was 7%, what was the real
interest rate you paid?
A) 17 percent B) 10 percent C) 7 percent D) 3 percent E) 1.5 percent - ANSWER-
D) 3 percent
When actual inflation is less than expected inflation,
A) borrowers and lenders both gain.
B) borrowers lose and lenders gain.
C) borrowers gain and lenders lose.
ANSWERS LATEST 2025
The nominal GDP of Canada in 2015 was approximately $1.99 trillion. This means
that
A) the value of output in 2015 was around $1.99 trillion.
B) total spending in 2015 was around $1.99 trillion.
C) total income in 2015 was around $1.99 trillion.
D) All of the above are true. - ANSWER-D) All of the above are true.
Table 4.4
Consumption expenditures $800
Investment expenditures 300
Government purchases 300
Government transfer payments 400
Exports 300
Imports 100
Refer to Table 4.4. Consider the data above (in billions of dollars) for an economy:
Based on the expenditure approach in macroeconomic models, gross domestic
product (in billions of dollars) for this economy equals
A) $2,200
B) $2,100
C) $1,600
D) $1,400
,E) $800. - ANSWER-C) $1,600
Gross domestic product understates the total production of final goods and services
because of the omission of
A) imports.
B) household production.
C) inflation.
D) intermediate goods.
E) exports. - ANSWER-B) household production.
Real GDP will increase
A) only if the price level rises.
B) only if the quantity of final goods and services produced rises.
C) only if the price level falls.
D) when nominal GDP falls.
E) if either the price level rises or the quantity of final goods and services produced
rises. - ANSWER-B) only if the quantity of final goods and services produced
rises.
Gross national income is defined as
A) the value of final goods and services produced outside of Canada.
B) the value of intermediate goods and services produced within Canada.
C) the value of final goods and services produced within Canada, by Canadian
residents.
D) the value of final goods and services produced within Canada.
,E) the value of payments received by Canadians for their factors of production
even if the production takes place outside of Canada. - ANSWER-C) the value of
final goods and services produced within Canada, by Canadian residents.
The ________ is a measure of the price level and is calculated by dividing
________ by ________ and multiplying by 100.
A) GDP deflator; real GDP; nominal GDP
B) GDP deflator; nominal GDP; real GDP
C) PPI; real GDP; nominal GDP
D) PPI; nominal GDP; real GDP
E) CPI; real GDP; nominal GDP - ANSWER-B) GDP deflator; nominal GDP; real
GDP
The labour force equals the number of people
A) employed.
B) in the entire country.
C) in the working-age population.
D) unemployed.
E) employed plus unemployed. - ANSWER-E) employed plus unemployed.
The natural rate of unemployment is the amount of unemployment
A) that exists when the economy goes into recession.
B) equal to frictional and cyclical unemployment.
C) that exists when the economy is in an expansion.
D) equal to seasonal and cyclical unemployment.
E) equal to frictional plus structural unemployment. - ANSWER-E) equal to
frictional plus structural unemployment.
, Which of the following policies would reduce structural unemployment?
A) a job retraining program
B) expanding employment insurance to cover more workers
C) building an online job database that helps workers find jobs
D) a government spending program designed to shorten recessions
E) an increase in the minimum wage - ANSWER-A) a job retraining program
A consumer price index of 160 in 2017 with a base year of 2002 would mean that
the cost of the market basket
A) equaled $160 in 2017.
B) rose 160% from the cost of the market basket in the base year.
C) equaled $160 in 2002.
D) rose 60% from the cost of the market basket in the base year.
E) is 160 times more than it cost in 2002. - ANSWER-D) rose 60% from the cost
of the market basket in the base year.
Imagine that you borrow $1,000 for one year and at the end of the year you repay
the $1,000 plus $100 of interest. If the inflation rate was 7%, what was the real
interest rate you paid?
A) 17 percent B) 10 percent C) 7 percent D) 3 percent E) 1.5 percent - ANSWER-
D) 3 percent
When actual inflation is less than expected inflation,
A) borrowers and lenders both gain.
B) borrowers lose and lenders gain.
C) borrowers gain and lenders lose.
