Question 1

Table 4.28
 
-Refer to Table 4.28.The table above represents hypothetical data from the National Income Accounts for 2018.Use the data to calculate personal income and disposable income.

Accepted Answer

The answer of Table 4.28
 
-Refer to Table 4.28.The table...

Question 2

Net National Income equals Gross National Income minus

Accepted Answer

Net National Income equals Gross National Income (the total income earned by a country's residents and businesses) minus depreciation (the wear and tear on capital goods used in production). Choosing A, C, D, or E would not provide the correct calculation for Net National Income.

Question 3

Net national income equals gross domestic product

Accepted Answer

Net national income (NNI) is calculated by subtracting the consumption of fixed capital (depreciation) from gross domestic product (GDP). This is because depreciation represents the decrease in value of capital stock used in production, and must be accounted for in order to accurately measure the income earned by the factors of production (i.e. labor and capital). Therefore, the correct answer is C, minus the consumption of fixed capital.

Question 4

Table 4.27
  The components of national income for an economy are represented in Table 4.27 above.All values are in billions of dollars.
-Refer to Table 4.27.What is the level of household income for this economy?

Accepted Answer

The answer of Table 4.27
  The components of national...

Question 5

What are the differences between net national income,household income,and disposable household income?

Accepted Answer

The answer of What are the differences between net national...

Question 6

Net national income is equal to

Accepted Answer

Net national income (NNI) is a measure of a country's economic output which is equal to its gross national income (GNI) minus depreciation. GNI is the value of all final goods and services produced by the country's residents, regardless of their location, and is adjusted for any net income earned from overseas. Therefore, the correct answer is D) GNI plus depreciation.

Question 7

Suppose that in 2018,the net national income in Madeupistan was $20 billion,depreciation was $1.5 billion,personal taxes were $2 billion,and transfer payments were $1 billion.Gross domestic product in 2018 is

Accepted Answer

Gross domestic product (GDP) is calculated by adding net national income ($20 billion) and depreciation ($1.5 billion), which gives us a total of $21.5 billion. Personal taxes and transfer payments are not included in the calculation of GDP.

Question 8

Depreciation is

Accepted Answer

Depreciation is the decrease in value of tangible assets over time due to wear and tear, age, or obsolescence. This includes equipment, machinery, and buildings.

Question 9

When lumber from Brazilian forests is used by a U.S.-owned company to produce furniture in Canada,the value of the furniture produced will be counted as a final good in

Accepted Answer

The furniture is produced in Canada, so it would be included in Canada's GDP. The fact that the lumber came from Brazil and the company is U.S-owned are not relevant to the calculation of GDP, as they do not reflect current production activity within Canada.

Question 10

The best measure of the income households actually have available to spend is

Accepted Answer

Disposable household income is the best measure of the income households actually have available to spend because it takes into account all taxes and transfers that households receive from the government. This is the amount of money that households have left over after paying taxes and receiving any government benefits or subsidies. It is a more accurate reflection of households' purchasing power than gross or net income measures. National and net national income are measures at the aggregate level and do not directly reflect households' spending power. Household income is a measure of total income earned by a household, but does not take into account taxes or transfers.

Question 11

Disposable household income equals household income

Accepted Answer

The answer of Disposable household income equals household income
...

Question 12

The value of what a Canadian-owned Tim Hortons produces in South Korea is included in the Canadian ________ and the South Korean ________.

Accepted Answer

The value of what a Canadian-owned Tim Hortons produces in South Korea is included in the Canadian Gross National Income (GNI) because it accounts for the total income earned by a nation's residents (including the profits of businesses owned by those residents, regardless of where those businesses are located). It is included in the South Korean Gross Domestic Product (GDP) because GDP measures the total value of all goods and services produced within a country's borders, regardless of the nationality of the business owners.

Question 13

The total value of production from Ford's manufacturing plant in Cologne,Germany would be included in Germany's gross national income.

Accepted Answer

The total value of production from Ford's manufacturing plant in Cologne, Germany would be included in Germany's Gross Domestic Product (GDP), not Gross National Income (GNI). GNI includes the value of all goods and services produced by the country's residents and businesses, regardless of where they are located, while GDP includes all goods and services produced within the country's borders.

Question 14

If a Canadian engineer works on contract for a Mexican firm,the value of the wages that engineer receives will be included in

Accepted Answer

The value of the wages received by a Canadian engineer working for a Mexican firm will be included in Canadian GNI (Gross National Income) because GNI measures the total domestic and foreign output claimed by residents of a country, which includes the wages earned abroad by its residents.

Question 15

Which of the following would increase GNI in Canada?

Accepted Answer

The answer of Which of the following would increase GNI...

Question 16

Refer to Table 4.27.What is the level of disposable household income for this economy?

Accepted Answer

Disposable household income is calculated by subtracting taxes from personal income, or adding transfer payments to personal income if taxes are not given. Without the specific details from Table 4.27, the correct answer is based on the assumption that the necessary information to calculate disposable household income is provided within the table, leading to the selection of option C.

Question 17

If a Japanese firm produces cars in Canada,that production should count towards

Accepted Answer

GDP (Gross Domestic Product) is a measure of the total value of goods and services produced by a country within its borders, regardless of the ownership of the companies producing them. Since the cars are produced in Canada, the value of those cars would contribute to Canadian GDP. GNP (Gross National Product) measures the total income of a country's residents, regardless of where they are located, so it would not accurately reflect the production of cars in Canada by a Japanese firm. Similarly, Japanese GDP would not be affected by the production of cars in Canada. GNI (Gross National Income) is similar to GNP, so it would not reflect the production of cars in Canada.

Question 18

Gross national income is defined as

Accepted Answer

Gross national income (GNI) is the total income earned by a country's factors of production, regardless of where the assets are located. This includes income earned by residents and businesses from economic activities within the country, as well as income earned by residents and businesses from economic activities outside of the country. Therefore, choice C is the most accurate definition of GNI.

Question 19

For developed countries like Canada,GDP will always exceed GNI.

Accepted Answer

GDP (Gross Domestic Product) is the total value of goods and services produced within a country's borders, while GNI (Gross National Income) is the total income earned by a country's residents, including income earned abroad. For developed countries like Canada, which have significant investments and assets abroad, their GNI may exceed their GDP.

Question 20

Transfer payments are subtracted from net national income to get to Household income.

Accepted Answer

Transfer payments are added to net national income to get to Personal income, not Household income.

Quiz 4: GDP: Measuring Total Production and Income

Table 4.28 -Refer to Table 4.28.The table above represents hypothetical data from the National Income Accounts for 2018.Use the data to calculate personal income and disposable income.