The
table below reports a CPI value for five different major cities in
August 2019. Use this information for question 31 below
City CPI (August, 2019)
Detroit 219.685
New York 257.069
Seattle 242.787
Los Angeles 239.940
Chicago 225.161
31. Assume during August, 2019, you earned $10,000. Based on
the CPI values above, in which city would your August income have
the greatest purchasing power?
A. Detroit
B. New York
C. Seattle
D. Los Angeles
E. Chicago
32. Higher real GDP does not necessarily mean we're better off
because:
A. higher real GDP could be the result of an increase in the
price level, not output
B. higher real GDP could be the result of an increase in the
underground economy
C. higher real GDP could be the result of companies selling
more used goods
D. higher real GDP (e.g. in the US) could be the result of
greater US investment in other countries
E. higher real GDP could be the result of our replacing
infrastructure damage in natural disasters
33. Which item below is not included in the investment
component of net domestic product?
A. Ford's replacement of depreciated machinery
B. UPS' expenditure on a new fleet of airplanes as they expand
operations
C. Increased construction of new homes
D. Yum brands expenditure on new computers as they expand
operations
E. none of the above
34. What goods are excluded from the calculation of GPD in
order to avoid what we called the double counting problem?
A. barter transactions
B. used goods
C. do-it-yourself activities
D. intermediate goods
E. goods sold within the underground economy