Econ chapter 4

  1. Which of the following does not represent investment in the economic sense?

    B. The purchase of newly issued shares in a company.
  2. If depreciation - consumption of fixed capital - exceeds gross private investment, it can be concluded that:

    B. Net investment is negative.
  3. Which of the following are considered an 'investment' by national income accountants?

    A. The purchase of a new house.
  4. In an expanding economy:

    C. Gross private domestic investment must exceed depreciation.
  5. A nation's stock of capital goods will decline when:

    B. Depreciation exceeds gross investment.
  6. Net exports are a negative figure when:

    A. A nation's imports of goods and services exceed its exports.
  7. The sale in 2012 of a car produced in 2008 should be included:

    B. Only in the calculation of GDP for 2008, as that is when the car was produced.
  8. Suppose Pete pays $100 to Moe. Which of the following is correct?

    A. We need more information to determine wheter GDP has changed.
  9. Answer the question below on the basis of the following national income data. All figures are in billions of dollars.
    Net export expenditures 22 (Expense)
    Rent, interest and profits 96 (Income)
    Investment expenditures by businesses 57 (Expense)
    Non-income allocations 118  (Income)
    Government purchases of goods and services 103 (Expense)
    Wages 216 (Income)
    Consumption expenditures by households 248 (Expense)

    A. $430
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Econ chapter 4
Macro practice quiz