Question 1

Suppose that national saving is $1456 billion,investment is $1945 billion,and private saving is $1590 billion.How much is the current account balance?

Accepted Answer

The answer of Suppose that national saving is $1456 billion,investment...

Question 2

In the mid-to-late 1980s,the United States had "twin deficits" because both ________ and ________ were negative.

Accepted Answer

The "twin deficits" refer to the situation in the mid- to late 1980s in the United States where both the government budget (government saving) and the current account were in deficit. The government was spending more than it was earning, and the country was importing more than it was exporting.

Question 3

Saving is a ________ variable,and wealth is a ________ variable.

Accepted Answer

Saving is a flow variable because it represents an amount accumulated over a specific period of time, such as monthly savings. Wealth, on the other hand, is a stock variable because it represents the accumulation of assets at a specific point in time.

Question 4

How are net exports,net factor payments from abroad,and the current account balance related?

Accepted Answer

The answer of How are net exports,net factor payments from...

Question 5

Citizens of the country of Heehaw produce hay and provide entertainment services (banjo playing).In one year they produced $15 million worth of hay,with $11 million consumed domestically and the other $4 million sold to neighboring countries.They provided $7 million worth of banjo-playing services,$5 million in Heehaw,and $2 million in neighboring countries.They purchased $6 million worth of soda pop from neighboring countries.
Calculate the magnitudes of GNP,GDP,net factor payments from abroad,net exports,and the current account balance.

Accepted Answer

The answer of Citizens of the country of Heehaw produce...

Question 6

The government budget surplus equals

Accepted Answer

The government budget surplus is the amount by which government receipts exceed government outlays. Therefore, option B is the correct answer. Option A includes transfers, which are not part of government outlays. Option C includes net receipts, which is not a common financial term used in reference to the government budget. Option D subtracts transfers from government purchases, which is not a correct formula for calculating the budget surplus.

Question 7

The uses-of-saving identity shows that if the government budget deficit rises,then one of the following must happen.

Accepted Answer

The uses-of-saving identity in macroeconomics indicates that if the government budget deficit increases (meaning the government is spending more than it is earning), it must be financed by either an increase in private saving, a decrease in investment, or a worsening of the current account (meaning the country is spending more on foreign goods than it is earning from selling goods abroad). This is because the total amount of savings in an economy must equal the total amount of investment plus the government's budget balance plus the current account balance.

Question 8

In a given year,a country's GDP = $9841,net factor payments from abroad = $889,taxes = $869,transfers received from the government = $296,interest payments on the government's debt = $103,consumption = $8148,and government purchases = $185.The country had private saving equal to

Accepted Answer

Private Saving = GDP - Consumption - Government Purchases - Taxes + Transfers Received - Interest Payments
Private Saving = $9841 - $8148 - $185 - $869 + $296 - $103
Private Saving = $2397

Question 9

In a given year,a country's GDP = $9841,net factor payments from abroad = $889,taxes = $869,transfers received from the government = $296,interest payments on the government's debt = $103,consumption = $8148,and government purchases = $185.The country had private saving equal to

Accepted Answer

Private saving can be calculated using the formula: Private saving = GDP + Net Factor Payments from Abroad - Taxes + Transfers - Consumption - Government Purchases. Plugging in the given values: Private saving = $9841 + $889 - $869 + $296 - $8148 - $185 = $2112.

Question 10

If a local government collects taxes of $500,000,has $350,000 of government consumption expenditures,makes transfer payments of $100,000,and has no interest payments or investment,its budget would

Accepted Answer

The budget surplus is calculated by subtracting the total expenditures from the total taxes collected. Here, total expenditures include government consumption expenditures ($350,000) and transfer payments ($100,000), totaling $450,000. Subtracting this from the taxes collected ($500,000) results in a surplus of $50,000.

Question 11

The value of a household's assets minus the value of its liabilities is called

Accepted Answer

The value of a household's assets minus the value of its liabilities is called their net worth or wealth. This represents their overall financial position and can give an indication of their ability to meet financial goals and handle unexpected expenses. Income refers to the amount of money a household earns over a period of time, while debt refers specifically to the amount of money owed to creditors. Stock refers to ownership in a company and is not necessarily related to a household's financial situation.

Question 12

National saving equals private saving plus government saving,which in turn equals

Accepted Answer

National saving is the total income in the economy that remains after paying for consumption and government purchases, which is calculated as GDP plus Net Foreign Factor Income (NFP) minus Consumption (C) and Government spending (G).

Question 13

If a local government collects taxes of $250,000,has $175,000 of government consumption expenditures,makes transfer payments of $75,000,and has no interest payments or investment,its budget would

Accepted Answer

The budget is balanced because the total tax revenue ($250,000) equals the sum of government consumption expenditures ($175,000) and transfer payments ($75,000), with no surplus or deficit.

Question 14

In the country of Kwaki,people produce canoes,fish for salmon,and grow corn.In one year they produced 5000 canoes using labor and natural materials only,but sold only 4000,as the economy entered a recession.The cost of producing each canoe was $1000,but the ones that sold were priced at $1250.They fished $30 million worth of salmon.They used $3 million of the salmon as fertilizer for corn.They grew and ate $55 million of corn.What was Kwaki's GDP for the year?

Accepted Answer

The answer of In the country of Kwaki,people produce canoes,fish...

Question 15

Private saving is defined as

Accepted Answer

Private saving is the amount of income that households have left after paying taxes and consumption. Therefore, it is private disposable income minus consumption (option A). The other options are incorrect because they do not accurately represent private saving.

Question 16

The uses-of-saving identity says that an economy's private saving is used for

Accepted Answer

The uses-of-saving identity states that an economy's private saving is used for investment, the government budget deficit, and the current account. Interest expenses and transfer payments are not mentioned in this identity.

Question 17

Suppose that private saving is $1590 billion,investment is $1945 billion,and the current account balance is -$489 billion.From the uses-of-saving identity,how much is government saving?

Accepted Answer

The uses-of-saving identity is given by private saving + government saving = investment + current account balance. Plugging in the given values: $1590 billion + government saving = $1945 billion - $489 billion. Solving for government saving gives us government saving = -$134 billion.

Question 18

In one year in the country of Countem,workers earned $4150,proprietor's income was $392,rental income was $20,corporate profits were $683,net interest was $228,taxes on production and imports were $329,business current transfer payments were $12,the current surplus of government enterprises was $3,statistical discrepancy was $28,consumption of fixed capital was $882,factor income received from the rest of the world was $331,and payments of factor income to the rest of the world was $623.Based on these data,compute national income,net national product,gross national product,and gross domestic product.

Accepted Answer

The answer of In one year in the country of...

Question 19

What is the main conceptual difference between GDP and GNP? How different are GDP and GNP for the United States? For countries with many citizens who work abroad?

Accepted Answer

The answer of What is the main conceptual difference between...

Question 20

In a given year,a country's GDP = $9841,net factor payments from abroad = $889,taxes = $869,transfers received from the government = $296,interest payments on the government's debt = $103,consumption = $8148,and government purchases = $185.The country had government saving equal to

Accepted Answer

Government saving is calculated as the difference between government revenue and government spending. Government revenue includes taxes and net factor payments from abroad, while government spending includes government purchases and transfers to the public. Interest payments on the government's debt are not considered part of the government's spending for the purpose of calculating government saving. Therefore, government saving = (Taxes + Net factor payments from abroad) - (Government purchases + Transfers) = ($869 + $889) - ($185 + $296) = $1758 - $481 = $1277. However, since none of the provided options match this calculation, it appears there was a mistake in my calculation based on the provided options. Re-evaluating the correct approach: Government saving should be calculated as Taxes - (Government purchases + Transfers). Thus, it should be $869 - ($185 + $296) = $869 - $481 = $388. This calculation was intended to find the correct answer, but it seems there was a misunderstanding in the interpretation of the options provided, leading to an incorrect initial explanation.

Quiz 2: The Measurement and Structure of the National Economy

Suppose that national saving is $1456 billion,investment is $1945 billion,and private saving is $1590 billion.How much is the current account balance?

In the mid-to-late 1980s,the United States had "twin deficits" because both and were negative.

Saving is a variable,and wealth is a variable.

How are net exports,net factor payments from abroad,and the current account balance related?

The government budget surplus equals

The uses-of-saving identity shows that if the government budget deficit rises,then one of the following must happen.

In a given year,a country's GDP = $9841,net factor payments from abroad = $889,taxes = $869,transfers received from the government = $296,interest payments on the government's debt = $103,consumption = $8148,and government purchases = $185.The country had private saving equal to

In a given year,a country's GDP = $9841,net factor payments from abroad = $889,taxes = $869,transfers received from the government = $296,interest payments on the government's debt = $103,consumption = $8148,and government purchases = $185.The country had private saving equal to

If a local government collects taxes of $500,000,has $350,000 of government consumption expenditures,makes transfer payments of $100,000,and has no interest payments or investment,its budget would

The value of a household's assets minus the value of its liabilities is called

National saving equals private saving plus government saving,which in turn equals

If a local government collects taxes of $250,000,has $175,000 of government consumption expenditures,makes transfer payments of $75,000,and has no interest payments or investment,its budget would

Private saving is defined as

The uses-of-saving identity says that an economy's private saving is used for

Suppose that private saving is $1590 billion,investment is $1945 billion,and the current account balance is -$489 billion.From the uses-of-saving identity,how much is government saving?

What is the main conceptual difference between GDP and GNP? How different are GDP and GNP for the United States? For countries with many citizens who work abroad?

In a given year,a country's GDP = $9841,net factor payments from abroad = $889,taxes = $869,transfers received from the government = $296,interest payments on the government's debt = $103,consumption = $8148,and government purchases = $185.The country had government saving equal to