Level 1-Test 2- Basic Structure of the United States

1.  Net National Product (NNP) is GNP minus depreciation. Net National Income (NNI) is NNP minus indirect taxes. Personal Income (PI) is NNI minus retained earnings, corporate taxes but it includes transfer payments, and interest on the public debt. Personal Disposable Income (PDI) is PI minus:

1. Personal labor.

2. Personal taxes.

3. Personal assets.

4. Personal  purchases.

2.  The economy of the United States has the world's largest gross domestic product (GDP). What was this GNP in 2006?

1.  $1.2 trillion

2. $5.2 Trillion

3. $13.2 trillion

4. $50.2 trillion

3.   While consumers and producers make most decisions that mold the economy, government activities have a powerful effect on the U.S. economy in at least four areas. These major areas are direct services, indirect services, regulation and control, and what other ingredient?

1. Stabilization and growth.

2. Political activity.

3.  Foreign affairs.

4. Taxation.

4.  Private businesses produce most goods and services. These goods and services are consumed by individuals for personal use, government, and businesses. About what percent is consumed by individuals?

1. 10 percent

2. 33 percent

3.  66 percent

4.  100 percent

5.  The President of the United States has a salary of:

1. The President of the United States doesn't have a salary.

2 $100,000

3. $250,000

4.  Greater then $400,000

6. Gross National Product (GNP) per person is often used as a measure of a person's welfare. There can be an issue with this metric. Does this metric measure the mean measure of a persons welfare or the median measure of a persons welfare?

1. Mean

2. Median

7  Inflation is the overall general upward price movement of goods and services in an economy, usually as measured by the Consumer Price Index and the Producer Price Index. As the cost of goods and services increase, what happens to the value of the dollar? 

1. The value of a dollar is going to fall

2. The value of a dollar is going to increase

8.  The U.S. public debt, commonly called the national debt, gross federal debt or U.S government debt, is the amount of money owed by the United States federal government to creditors who hold U.S. Debt Instruments. As of December 19, 2007, the total U.S. federal debt held by the public was roughly $5 trillion. This does not include the money owed by states, corporations, or individuals, nor does it include the money owed to Social Security beneficiaries in the future. If intragovernment debt obligations are included, the debt figure rises to roughly $9 trillion. If unfunded Medicaid, Social Security, etc. promises are added, this figure rises to a total of :

1. $15.1 trillion

2.  $25.1 trillion

3. $59.1 trillion

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