Question 1

What kind of information is conveyed in a time-series graph?

Accepted Answer

The answer of What kind of information is conveyed in...

Question 2

A graph shows the wages of factory workers.The slope of the line is positive for periods when the wage rate is

Accepted Answer

The slope of a line represents the rate of change of the variable on the y-axis with respect to the variable on the x-axis. In this case, the y-axis represents the wage rate, and the x-axis represents time. If the slope is positive, it means that the wage rate is increasing over time, which corresponds to rising wages for the factory workers. Therefore, the best choice is B.

Question 3

11 Appendix: Numeric and Graphing Questions
 
-A trend is a general tendency for a variable to increase or decrease over time.

Accepted Answer

This statement is true.

Question 4

A time-series graph displays the price of copper.The slope of the line is negative for periods when the

Accepted Answer

A negative slope indicates a decrease in the value being measured, so in this case, a negative slope would indicate a decrease in the price of copper. Thus, the best choice is A, which states that the slope is negative when the price of copper is falling.

Question 5

On a time-series graph with a ratio scale,

Accepted Answer

On a time-series graph with a ratio scale, the vertical axis represents the level of the variable, and the distance along this axis represents equal intervals of change. Therefore, the same distance along the vertical axis measures different amounts of the variable. The slope of the line is positive when the level of the variable is rising, and it is possible to determine a trend based on the direction of the line. Time is plotted on the horizontal axis, not the vertical axis.

Question 6

11 Appendix: Numeric and Graphing Questions
 
-The figure above shows the price of a DVD player from 2003 to 2007.
a) What type of graph is illustrated above?
b) What is the trend in the price of a DVD player?

Accepted Answer

The answer of 11 Appendix: Numeric and Graphing Questions
 
-The...

Question 7

Real GDP in 2012 is $10 trillion.Between 2012 and 2013,using 2012 prices,GDP grew 3 percent and using 2013 prices real GDP grew 7 percent.Using the chain-weighted output index method,real GDP in 2013 is ________ trillion.

Accepted Answer

The chain-weighted output index method averages the growth rates using different base years. The average of 3% and 7% growth rates is 5%. Applying this to the 2012 GDP of $10 trillion gives $10.5 trillion for 2013.

Question 8

Which of the following is TRUE regarding the chain-weighted output index method?
I. It is the method used to measure the growth rate of nominal GDP.
II. It uses data from the current year and from the previous year.
III. It is a method of measuring the growth rate of real GDP.

Accepted Answer

The chain-weighted output index method is a method of measuring the growth rate of real GDP, using data from the current year and from the previous year. It adjusts for changes in relative prices between the two years by weighting the components of GDP based on their current year prices. It is not used to measure the growth rate of nominal GDP.

Question 9

The chain-weighted output index method of calculating real GDP compares

Accepted Answer

The chain-weighted output index method calculates real GDP by comparing the quantities of goods produced in consecutive years using prices in both years and averaging the percentage changes in the value of output. This method is considered superior to other methods because it takes into account changes in the composition of goods and services produced over time.

Question 10

The chain-weighted output index method of measuring real GDP is based on

Accepted Answer

The chain-weighted output index method of measuring real GDP is based on using the prices of two adjacent years to calculate the growth rate of real GDP. It is considered a more accurate method than using a fixed base year because it takes into account changes in relative prices over time.

Question 11

At 2012 prices,the value of production in 2013 was 6 percentage points higher than in 2012.At 2013 prices,the value of production in 2013 was 4 percentage points higher than in 2012.Using the chain-weighted output index,real GDP is ________ in 2013 than in 2012.

Accepted Answer

The chain-weighted output index averages the growth rates using different base years. The average of 6% and 4% is 5%, so real GDP is 5% greater in 2013 than in 2012.

Question 12

Valuing the quantities of goods produced in consecutive years using prices in both years and then averaging the percentage changes in the value of output is part of the ________ method of calculating real GDP.

Accepted Answer

The method described in the question is known as the chain-weighted output index, which provides a more accurate estimate of real GDP by accounting for changes in both prices and quantities from year to year. The other options mentioned (base-year, moving-base-year, fixed quantities/variable prices) do not involve averaging percentage changes or accounting for both price and quantity changes, so they are not the best choice.

Question 13

11 Appendix: Numeric and Graphing Questions
 
-A time series graph can show both the level of a variable and the speed with which the variable changes over time.

Accepted Answer

A time series graph displays both the level and changes over time.

Question 14

You believe that the total amount of goods produced in the United States has generally increased over the years.In a time-series graph illustrating the total amount produced,you expect to find

Accepted Answer

An upward trend is expected as the question states that the belief is that the total amount of goods produced in the U.S. has generally increased over the years. A time-series graph would show this trend over time.

Question 15

The chain-weighted output index

Accepted Answer

The chain-weighted output index uses prices for the current year and the previous year to calculate growth in real GDP. This method is preferred over the traditional fixed-weighted output index because it incorporates changes in the economy's structure and relative prices over time. It is not necessary to calculate it only every other year, and it is not accurate to say that it has been replaced by the "nominal-to-real" index as they serve different purposes.

Question 16

The chain-weighted output index method ________.

Accepted Answer

The chain-weighted output index method uses the prices of two adjacent years to calculate the real GDP growth rate, and is a more accurate and modern method compared to traditional fixed-weight GDP calculations that use base-year prices. Option A is incorrect as nominal GDP is calculated using current market prices. Option B is incorrect as the chain-weighted method does not value quantities produced at base-year prices. Option C is incorrect as there may be periods where real GDP decreases due to economic downturns or other factors.

Quiz 4: Measuring GDP and Economic Growth