MACRO EXAM 3 - CLEMSON ECON 2120 EXAM
QUIZZES WITH 100% CORRECT ANSWERS .
Economists use the word "capital" to mean
A) the tools, instruments, and other produced goods used to produce goods and services.
B) the funds that firms use to buy and operate their businesses.
C) the workers that firms employ to produce goods and services.
D) purchases in the market for stocks and bonds.
E) people's skills and talents - Correct Answer -A
Federal Express's purchase of trucks and planes
A)reflects capital gains.
B)is financial capital.
C)includes depreciation.
D)creates wealth.
E)is an example of physical capital - Correct Answer -E
The distinction between physical and financial capital is that
A)the value of financial capital depends on the amount of available physical capital.
B)physical capital is equal to financial capital plus depreciation.
C)physical capital is equal to financial capital minus depreciation.
D)financial capital depreciates and physical capital does not.
E)financial capital is used to purchase and operate physical capital - Correct Answer -E
________ increases the quantity of capital, and ________ decreases the quantity of capital.
1
,A) Net investment; gross investment
B) Investment; depreciation
C) Investment; saving
D) Gross investment; net investment
E) Depreciation; net investment - Correct Answer -B
The total amount spent to buy new physical capital and replace old capital is referred to as
A) depreciation.
B) net investment.
C) gross investment.
D) wealth.
E) savings - Correct Answer -C
Net investment is
A)gross investment plus depreciation
B)the same as wealth
C)the same as depreciation.
D)gross investment minus depreciation
E)the same as gross investment.1 - Correct Answer -D
The Zonamo company produces waste disposal machines and sells them to militaries all over
the world. The company started last year with $10 million of capital on hand and invested
$15 million in new capital throughout the year. At the end of the year, the company's capital
stock was $17million. Hence, for the year, depreciation equaled ________ and net investment
equaled ________.
A)$8 million; $15 million
B)$25 million; $5 million
C)$8 million; $7 million
D)$5 million; $5 million
2
, E)$7 million; $8 million - Correct Answer -C
Bill's Lawn service starts the year with 20 lawn mowers. During the year, 3 mowers break
and are not worth fixing. Bill also expands his business and buys 10 more mowers. Bill's net
investment is ________ mowers.
A) 20
B) 7
C) 27
D) 10
E) 13 - Correct Answer -E
Bill's Lawn service starts the year with 20 lawn mowers. During the year, 3 mowers break
and are
not worth fixing. Bill also expands his business and buys 10 more mowers. Bill's capital at
the end of the year is ________ mowers.
A) 30
B) 20
C) 10
D) 27
E) 33 - Correct Answer -D
Wealth is
A)another name for income.
B)defined as the money in your savings account.
C)the value of all the things that a person owns.
D)equivalent to saving
E)the same as investment in financial capital - Correct Answer -C
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QUIZZES WITH 100% CORRECT ANSWERS .
Economists use the word "capital" to mean
A) the tools, instruments, and other produced goods used to produce goods and services.
B) the funds that firms use to buy and operate their businesses.
C) the workers that firms employ to produce goods and services.
D) purchases in the market for stocks and bonds.
E) people's skills and talents - Correct Answer -A
Federal Express's purchase of trucks and planes
A)reflects capital gains.
B)is financial capital.
C)includes depreciation.
D)creates wealth.
E)is an example of physical capital - Correct Answer -E
The distinction between physical and financial capital is that
A)the value of financial capital depends on the amount of available physical capital.
B)physical capital is equal to financial capital plus depreciation.
C)physical capital is equal to financial capital minus depreciation.
D)financial capital depreciates and physical capital does not.
E)financial capital is used to purchase and operate physical capital - Correct Answer -E
________ increases the quantity of capital, and ________ decreases the quantity of capital.
1
,A) Net investment; gross investment
B) Investment; depreciation
C) Investment; saving
D) Gross investment; net investment
E) Depreciation; net investment - Correct Answer -B
The total amount spent to buy new physical capital and replace old capital is referred to as
A) depreciation.
B) net investment.
C) gross investment.
D) wealth.
E) savings - Correct Answer -C
Net investment is
A)gross investment plus depreciation
B)the same as wealth
C)the same as depreciation.
D)gross investment minus depreciation
E)the same as gross investment.1 - Correct Answer -D
The Zonamo company produces waste disposal machines and sells them to militaries all over
the world. The company started last year with $10 million of capital on hand and invested
$15 million in new capital throughout the year. At the end of the year, the company's capital
stock was $17million. Hence, for the year, depreciation equaled ________ and net investment
equaled ________.
A)$8 million; $15 million
B)$25 million; $5 million
C)$8 million; $7 million
D)$5 million; $5 million
2
, E)$7 million; $8 million - Correct Answer -C
Bill's Lawn service starts the year with 20 lawn mowers. During the year, 3 mowers break
and are not worth fixing. Bill also expands his business and buys 10 more mowers. Bill's net
investment is ________ mowers.
A) 20
B) 7
C) 27
D) 10
E) 13 - Correct Answer -E
Bill's Lawn service starts the year with 20 lawn mowers. During the year, 3 mowers break
and are
not worth fixing. Bill also expands his business and buys 10 more mowers. Bill's capital at
the end of the year is ________ mowers.
A) 30
B) 20
C) 10
D) 27
E) 33 - Correct Answer -D
Wealth is
A)another name for income.
B)defined as the money in your savings account.
C)the value of all the things that a person owns.
D)equivalent to saving
E)the same as investment in financial capital - Correct Answer -C
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