Econ 203 Ole Miss Matthews
Test 1 with correct questions
and answers
usr
[COMPANY NAME] [Company address]
, 1. GDP stands for Answer: Gross Domestic Product
2. GDP formula Answer: Y=C+I+G+NX
3. Gross Domestic Product is Answer: The market value of all final goods and services
produced within a country
in a given period of time.
4. GDP includes Answer: - all items produced in the economy and sold legally in markets
-only the value of final goods
-tangible goods (food, clothing, cars)
-intangible goods (haircuts, housecleaning, doctor visits)
-goods and services currently produced
5. GDP excludes Answer: household production, underground production, leisure time, environment
quality
6. GDP (which we denote as Y) is divided into four components Answer: -
consumption (C)
-investment (I)
-goverment purchases (G)
-net exports (NX)
7. Consumption definition Answer: spending by households on goods and services, with the
exception of purchas- es of new housing
8. Consumption includes Answer: - spending on durable goods (automobiles and
appliances)
-nondurable goods (food and clothing)
-services (intangible items such as haircuts and medical care)
-household spending on education
9. Investment definition Answer: is the purchase of goods (called capital goods) that will be
used in the future to produce more goods and services
10. Investment includes Answer: the sum of purchases of
-business capital (business structures, factory or oflce building, equipment, intellectual property products
the software that runs on the computer)
-residential capital (landlords apartment building and homeowners personal residence)
-by convention, the purchase of a new house is the one type of household spending categorized as
investment
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9
Test 1 with correct questions
and answers
usr
[COMPANY NAME] [Company address]
, 1. GDP stands for Answer: Gross Domestic Product
2. GDP formula Answer: Y=C+I+G+NX
3. Gross Domestic Product is Answer: The market value of all final goods and services
produced within a country
in a given period of time.
4. GDP includes Answer: - all items produced in the economy and sold legally in markets
-only the value of final goods
-tangible goods (food, clothing, cars)
-intangible goods (haircuts, housecleaning, doctor visits)
-goods and services currently produced
5. GDP excludes Answer: household production, underground production, leisure time, environment
quality
6. GDP (which we denote as Y) is divided into four components Answer: -
consumption (C)
-investment (I)
-goverment purchases (G)
-net exports (NX)
7. Consumption definition Answer: spending by households on goods and services, with the
exception of purchas- es of new housing
8. Consumption includes Answer: - spending on durable goods (automobiles and
appliances)
-nondurable goods (food and clothing)
-services (intangible items such as haircuts and medical care)
-household spending on education
9. Investment definition Answer: is the purchase of goods (called capital goods) that will be
used in the future to produce more goods and services
10. Investment includes Answer: the sum of purchases of
-business capital (business structures, factory or oflce building, equipment, intellectual property products
the software that runs on the computer)
-residential capital (landlords apartment building and homeowners personal residence)
-by convention, the purchase of a new house is the one type of household spending categorized as
investment
2/
9
