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The sum of all compensation to employees, rents, interest excluding interest on the public debt...

Question:

1. The sum of all compensation to employees, rents, interest (excluding interest on the public debt and interest paid by consumers) and profits (both corporate and non-corporate) earned in the economy in any given year would yield

A. Gross Domestic Product Net

B. National Product

C. National Income

D. Personal Income Disposable Income

2. Thomas Sowell argues that Fed Chair Janet Yellen's very Keynesian view of economic theory and policy dominated U.S. economic thought once upon a time--until it encountered two things. Those two things were:

A. Paul Krugman and the theory of fiscal drag

B. Milton Friedman and the stagflation of the 1970s

C. Paul Volcker and the soaring interest rates of the late 1970s and early 1980s

D. Reality and the Dow

3. Which of the following variables is measured/expressed as a stock?

A. national income

B. consumption inflation

C. money (e.g., M1 or M2)

D. none of the above-all are flow variables

4. According to standard Keynesian economic theory, an increase in government spending has a greater impact in terms of increasing the level of aggregate income--that is, is more "stimulative"--if it is:

A. financed by raising taxes to pay for it

B. financed by selling Treasury debt on the open market

C. financed by creating new money--that is, by "monetizing the debt"

D. Keynesian theory holds that increased government spending reduces the level of aggregate income

Gross Domestic Product:

Gross domestic product refers to the total income or output of a country. It measures the growth of any economy in terms of income. GDP only includes goods and services produced within the geographical boundaries of a country. Income from abroad will be included in the Gross National Product of a nation.

Answer and Explanation:

1. The sum of all compensation to employees, rents, interest (excluding interest on the public debt and interest paid by consumers) and profits (both corporate and non-corporate) earned in the economy in any given year would yield D. Personal Income Disposable Income

Explanation:

Personal disposable income refers to the income that is provided to people for personal use. It includes income earned by working, rent, interest, profits, and so on, which are used to a consumer or save by the individuals.

2. Thomas Sowell argues that Fed Chair Janet Yellen's very Keynesian view of economic theory and policy dominated U.S. economic thought once upon a time--until it encountered two things. Those two things were: B. Milton Friedman and the stagflation of the 1970s

3. Which of the following variables is measured/expressed as a stock? D. none of the above-all are flow variables

Explanation:

Stock refers to the things that are measured at a particular time. On the other hand, flow refers to the things that changes over a period of time. All the above statements are the example of the flow variable.

4. According to standard Keynesian economic theory, an increase in government spending has a greater impact in terms of increasing the level of aggregate income--that is, is more "stimulative"--if it is: A. financed by raising taxes to pay for it

Explanation:

Keynesian theory is highly emphasizing the involvement of government in the market to stabilize price and output level. It mainly focuses on government spending than the taxation system of government.


Learn more about this topic:

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Gross Domestic Product: Definition and Components

from Economics 102: Macroeconomics

Chapter 4 / Lesson 3
62K

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