The value of the production of final goods and services in an economy adjusted f
ID: 1119549 • Letter: T
Question
The value of the production of final goods and services in an economy adjusted for inflation since the base year is called
a. Nominal GDP . b. Real GDP . c. Nominal GNP . d. the cost of production.
Gross domestic product is defined as
a. the market value of all goods and services produced by the citizens of a country, regardless of where they are living, in a given period of time.
b. the market value of all final goods and services produced by the citizens of a country, regardless of where they are living, in a given period of time.
c. the market value of all goods and services produced within a country in a given period of time.
d. the market value of all final goods and services produced within a country in a given period of time.
Assuming constant real interest rates, a decrease in the inflation rate ___________ nominal interest rates over the long term.
a. decrease.
b. increase.
c. not change.
Fiscal policies that are typically used to expand output and reduce unemployment include
a. increasing taxes and decreasing government spending.
b. decreasing taxes and increasing government spending.
c. decreasing taxes and government spending.
d. increasing taxes and government spending.
a. the market value of all goods and services produced by the citizens of a country, regardless of where they are living, in a given period of time.
b. the market value of all final goods and services produced by the citizens of a country, regardless of where they are living, in a given period of time.
c. the market value of all goods and services produced within a country in a given period of time.
d. the market value of all final goods and services produced within a country in a given period of time.
Assuming constant real interest rates, a decrease in the inflation rate ___________ nominal interest rates over the long term.
a. decrease.
b. increase.
c. not change.
Fiscal policies that are typically used to expand output and reduce unemployment include
a. increasing taxes and decreasing government spending.
b. decreasing taxes and increasing government spending.
c. decreasing taxes and government spending.
d. increasing taxes and government spending.
Explanation / Answer
1.
The value of the production of final goods and services in an economy adjusted for inflation since the base year is called:
b. Real GDP.
This is because real GDP measures the output adjusted for any inflation.
2.
Gross domestic product is defined as:
d. the market value of all final goods and services produced within a country in a given period of time.
GDP equals to sum of consumption expenditure, investment expenditure, government expenditure and net export of a country.
3.
Assuming constant real interest rates, a decrease in the inflation rate
a. decrease
nominal interest rates over the long term.
This is becuase nominal interest rate = real interest rate + inflation rate.
4.
Fiscal policies that are typically used to expand output and reduce unemployment include:
c. decreasing taxes and government spending.
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