Why is it important to use real GDP rather than nominal GDP figures when making comparisons of ...

Why is it important to use real GDP rather than nominal GDP figures when making comparisons of output across time periods?
 a. The real GDP figures are a better measure of changes in the general level of prices.
  b. The real figures will reflect changes in the quantity of output and not changes in the general level of prices.
  c. The real figures will reflect changes in the general level of prices as well as changes in the quantity of output.
  d. The real GDP figures adjust for changes in the level of employment.

QUESTION 2

A change in which of the following would shift the aggregate demand curve?
 a. Consumption (C)
  b. Investment (I)
  c. Government spending (G)
  d. Net Exports (NX)
  e. All of these

QUESTION 3

Which of the following statements is true?
 a. The inclusion of intermediate goods and services into GDP calculations would underestimate our nation's production level.
  b. The expenditures approach sums the compensation of employees, rents, profits, net interest, and nonincome expenses for depreciation and indirect business taxes.
  c. Real GDP has been adjusted for changes in the general level of prices due to inflation.
  d. Real GDP equals nominal GDP multiplied by the GDP deflator.

QUESTION 4

The aggregate demand curve will shift rightward when there is:
 a. a decrease in government spending.
  b. a decrease in incomes abroad.
  c. a tax increase.
  d. the expectation that future consumer income will rise.

QUESTION 5

In an economy with persistent inflation,
 a. real GDP will grow faster than nominal GDP.
  b. nominal GDP will grow faster than real GDP.
  c. nominal and real GDP will grow at the same rate.
  d. nominal and real GDP will both fall.

QUESTION 6

A cut in government spending, a decrease in income abroad, an increase in taxes, or an expectation that future consumer income will fall will all cause aggregate:
 a. demand to shift rightward.
  b. demand to shift leftward.
  c. supply to shift rightward.
  d. supply to shift leftward.
  e. supply and aggregate demand to both shift equally inward.

QUESTION 7

Increased production, but not increased inflation, will result in higher:
 a. nominal GDP.
  b. money GDP.
  c. real GDP.
  d. current dollar GDP.

QUESTION 8

Suppose workers become pessimistic about their future employment, which causes them to save more and spend less. If the economy is on the intermediate range of the aggregate supply curve, then:
 a. both real GDP and the price level will fall.
  b. real GDP will fall and the price level will rise.
  c. real GDP will rise and the price level will fall.
  d. both real GDP and the price level will rise.

QUESTION 9

Real GDP means GDP:
 a. valued at prices in a base year.
  b. that does not change from year to year.
  c. corrected for changes in quality.
  d. valued at prices at which goods are actually sold.