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Macroeconomics 6th Edition Williamson Test Bank
Macroeconomics 6th Edition Williamson Test Bank
Macroeconomics, 6e (Williamson)
Chapter 2 Measurement
1) NIPA means
A) New Income and Price Accounting.
B) National Investment and Productivity Approach.
C) Neutral Increase of Production Allocation.
D) National Income and Product Accounts.
Answer: D
LO: 2.1: Construct measures of gross domestic product using the product approach, the
expenditure approach, and the income approach.
Difficulty: moderate
Classification: concept
AACSB: application of knowledge
1
Copyright © 2018 Pearson Education, Inc.
5) Acme Steel Co. produces 1000 tons of steel. Steel sells for $30 per ton. Acme pays wages of
$10,000. Acme buys $15,000 worth of coal, which is needed to produce the steel. Acme pays
$2,000 in taxes. Acme's contribution to GDP is
A) $15,000.
B) $20,000.
C) $30,000.
D) $45,000.
Answer: A
LO: 2.1: Construct measures of gross domestic product using the product approach, the
expenditure approach, and the income approach.
Difficulty: moderate
Classification: application
AACSB: analytical thinking
6) Suppose we have the following information about a car manufacturer: car sales $1000M, steal
purchases $600M, wages $300M, interest on business loans $50M, and profits $50M. What is its
contribution to GDP using the product approach?
A) $1000M
B) $600M
C) $400M
D) $350M
Answer: C
LO: 2.1: Construct measures of gross domestic product using the product approach, the
expenditure approach, and the income approach.
Difficulty: moderate
Classification: application
AACSB: analytical thinking
2
Copyright © 2018 Pearson Education, Inc.
7) We know the following about a tie manufacturer: tie sales $1,300, cotton purchases $750,
wages $400, interest on business loans $100, and profits $50. What is the contribution to GDP of
this producer using the income approach?
A) $550
B) $500
C) $450
D) $400
Answer: A
LO: 2.1: Construct measures of gross domestic product using the product approach, the
expenditure approach, and the income approach.
Difficulty: difficult
Classification: application
AACSB: analytical thinking
8) We learn the following about a ski resort: ticket sales $100M, snow making expenses $70M,
wages $20M, interest on business loans $5M, and profits $5M. What is the contribution to GDP
using the product approach?
A) $70M
B) $80M
C) $95M
D) $100M
Answer: A
LO: 2.1: Construct measures of gross domestic product using the product approach, the
expenditure approach, and the income approach.
Difficulty: easy
Classification: application
AACSB: analytical thinking
9) Here is what we know about a household: wages $25,000, unemployment insurance benefits
$3,000, dividend income $4,000, income tax $5,000. What is the contribution to GDP of this
household following the expenditure approach?
A) $24,000
B) $25,000
C) $28,000
D) $29,000
Answer: C
LO: 2.1: Construct measures of gross domestic product using the product approach, the
expenditure approach, and the income approach.
Difficulty: moderate
Classification: application
AACSB: analytical thinking
3
Copyright © 2018 Pearson Education, Inc.
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coast which M’Clure named the Bay of God’s Mercy. From this haven
she was destined never to move, the winters of 1851–2, 1852–3, being
passed there. Banks Land had only been sighted by Parry at a great
distance. M’Clure’s discovery of the great island was an achievement of
the first rank. These proceedings of Collinson and M’Clure were of
course unknown in England when it was resolved to despatch the four
ships again, the Assistance and Pioneer to go up Wellington Channel, the
Resolute and Intrepid to press onwards to Melville Island. The Franklin
search could in no way be furthered by sending in directions he could
never have taken, but the relief of the Investigator proved to be a service
of the utmost importance.
Common sense pointed to M’Clintock and Sherard Osborn as the
proper leaders for the two divisions. Both possessed unequalled recent
Arctic experience, both were men of tried ability, liked and respected by
all who had served under them. The Admiralty, however, preferred an
old officer with bad health, no Arctic experience, and the reputation of
being the most unpopular man in the navy, Sir Edward Belcher. It would
have been enough that he should bring misery, disaster, and failure on his
own division, but both were under his orders. Sherard Osborn was with
him in command of the Pioneer. The officer to command the second
division, Captain Kellett, was also old and inexperienced, but fortunately
very unlike Belcher. He had been a distinguished surveying officer in his
time, and now he wisely left things to his staff. Hearty, joyous, with a
charming manner, Captain Kellett gave pleasure wherever he went.
M’Clintock commanded the Intrepid, Mecham was Kellett’s first
lieutenant, Vesey Hamilton was Mecham’s friend and supporter—the
very cream of the rising Arctic generation.
Critical position of H.M.S. Investigator on the North Coast of Baring
Island, Aug. 20th, 1851
The expedition left the Thames April 15, 1852, and M’Clintock
acquired great skill in handling the Intrepid in the ice of Melville Bay,
where the Resolute received a very severe nip, and was raised 8 feet out
of the water, being for some time in great danger. The squadron reached
Beechey Island August 14th, where the North Star was to remain as a
depôt ship. Next day the two divisions parted company. The Assistance
and Pioneer proceeded up Wellington Channel to winter in a harbour in
77° 52′ N., while the Resolute and Intrepid went on to Melville Island
with little difficulty, where they found winter quarters in a bay sheltered
by Dealy Isle, so named after a midshipman of the Hecla, in 74° 56′ N.
We must pause here for a moment to record a modest but successful
expedition carried out in the same season of 1852 by Captain Inglefield,
who in the little Isabel, piloted by wonderful old Abernethy, went for a
summer cruise up Baffin’s Bay. He reached the entrance of Smith Sound
and saw that it was an important channel leading to the polar ocean—
really Smith Channel. To the land on the west side, which was
discovered by Baffin but not named by him, he gave the name of
Ellesmere Island.
M’Clintock decided upon a system of autumn travelling for laying
out depôts on a much larger scale than in the previous expedition. This
time he was absent 40 days, and went over 260 miles. Four other autumn
travelling parties laid out depôts, Mecham doing 212 miles in 25 days,
Vesey Hamilton 84 miles in 16 days. Mecham made a very important
discovery. He found a record left by Captain M’Clure of the Investigator
on Parry’s sandstone rock, in the spring of 1852. M’Clure gave the
position of the ship in the Bay of Mercy, and added that if the
Investigator was not again heard of, she would probably have been
carried into the polar pack west of Melville Island, in which case any
attempt to succour him would be useless—a very noble thing for a man
in his position to have written.
The plan for sledge travelling in the spring was that M’Clintock was
to explore as far as possible to the north and west, Mecham to the west,
and Vesey Hamilton to the north. On March 10th a sledge was sent to
communicate with the Investigator in the Bay of Mercy, a distance of
160 miles.
M’Clintock’s two large sledges, when loaded, weighed 2000 lb., or
228 lb. per man on starting. Of the sledge crew of 1851 Salmon was still
well and hearty. George Green, ice quartermaster, was captain of the
sledge, an excellent man; Henry Giddy, boatswain’s mate, was almost
equally good. May 4th, 1853, was a day to be remembered, the
beginning of the greatest sledge journey but one on record. The sledges
were drawn up in two lines with their banners displayed, and started.
M’Clintock and his depôt sledge advanced over the land to Cape Nias.
Mecham and Nares went away under sail to the westward, with a fair
wind.
M’Clintock and De Bray, a young French naval officer lent to the
expedition, proceeded with the depôt sledge along the north coast to
Cape Fisher, the extreme point seen by Parry. Here De Bray and the
depôt sledge returned, while M’Clintock turned south to make sure of
connecting his work with that of Mecham. He travelled along the west
coast of Melville Island and considered that it presented the most
beautiful Arctic scenery he had ever seen. A great unknown land had
long been in sight to the westward to which he gave the name of Prince
Patrick Island. It was on May 14th, 1853, that M’Clintock landed on his
new discovery at Point Wilkie, named after his old sledge captain, and
geologically a place of great importance, as exhibiting a patch of has
formation with fossils. The north end of Prince Patrick Island was
reached on the 11th June, and M’Clintock went on to some islands which
he named the Polynia Isles. In the offing there was a line of very heavy
pack ice, with hummocks 35 ft. high. The most northern point reached
was 77° 43′, and here, sending back the sledge to the depôt, the explorer
proceeded down the western coast with a satellite sledge over flat sand-
banks, with a continuous line of stupendous hummocks in the offing.
They rejoined the parent sledge on the 25th June. M’Clintock’s next
discovery was named Emerald Isle, most of the usual Arctic plants and
abundant moss being found on it. The return journey entailed terrible
work owing to the water on the floes.
M’Clintock had been away 105 days and the sledge had gone over
1030 geographical miles in 99 marches, at a rate of 10½ miles a day.
The examination of bays and inlets with the satellite sledge
amounted to 62½ miles, making the whole distance 1210 geographical or
1408 statute miles. The lowest temperature was -24° Fahr.; the number
of positions fixed was 22. This journey was by far the greatest Arctic
effort with sledges that has ever been made by men alone.
132
Mecham did splendid work to the eastward. Nares commanded
the depôt sledge, and Mecham’s sledge captain was James Tullett, a
capital sailor, who was in the Assistance. Travelling over the south-west
part of Melville Island Mecham crossed a strait, and discovered an island
which received the name of Eglinton, where Nares left the depôt and
returned. Another journey across a strait brought Mecham to the south-
west point of Prince Patrick Island. He then explored its southern and
western coasts until he reached a point within 16 miles of M’Clintock’s
furthest, coming from the north. Mecham’s principal discovery was the
remains of trees. At Cape Manning, on the south coast, there were a
considerable number of stems of trees with the bark on, 90 feet above the
sea. Returning, Mecham crossed the land during the three last days of
May and found, in a ravine, a tree protruding 8 feet, and several others
with a circumference of 4 feet.
The young explorer then connected his work with that of
M’Clintock on the east side of Prince Patrick Island, thus making these
vast discoveries complete. He got plenty of fresh food for his people,
killing four musk oxen, seven reindeer, sixteen hares, forty ptarmigan,
twelve ducks and geese, and two plover. He was absent 91 days, and
went over 1006 geographical or 1173 statute miles, thus averaging 12½
miles a day. His discoveries amounted to 785 miles of new country.
Vesey Hamilton explored the northern extremity of Melville Island,
called the Sabine Peninsula, starting on the 27th April with a seven-man
sledge and a satellite sledge. The captain of his sledge was Ice-
Quartermaster George Murray, who had served in both the expeditions of
Ross and Austin. He was a seaman of long experience and great ability,
with literary talent of no mean order, as his contributions to the Aurora
Borealis show. Having explored the whole eastern side of Melville
Island, Hamilton crossed the channel with his satellite and two men to
Bathurst Island, where he met Sherard Osborn, who had explored the
northern side of this island with its two deep inlets, and sighted another
large island to the north which was named after Mr Findlay, the
cartographer. Hamilton then returned to his main sledge, and reaching
the extreme northern point of the Sabine Peninsula, discovered two
islands which were named Vesey Hamilton and Markham after his old
messmates in the Assistance. He returned to the ship after an absence of
54 days, having covered 663 statute miles, and made some interesting
discoveries. This completed the extensive explorations of 1853,
comprising 1800 miles of coast line.
The officers and crew of the Investigator had been rescued from the
fate of Franklin and his people by Mecham’s discovery of M’Clure’s
record. On the arrival of the sledge with the good news at the Bay of
Mercy, Captain M’Clure travelled to the Resolute to discuss
arrangements with Captain Kellett. It was determined to abandon the
Investigator, officers and crew being housed on board the Resolute and
Intrepid. Thus was a third North West Passage discovered.
Lieut. Cresswell of the Investigator with 26 officers and men were
despatched to the North Star at Beechey Island to be sent home at the
first opportunity. The Admiralty had sent out the Phoenix, commanded
by Captain Inglefield, and the Breadalbane transport, under Mr
Fawckner, Master R.N., to communicate. The Breadalbane was crushed
by the ice off Beechey Island and sank. Captain Inglefield had brought
out with him Lieut. Bellot, the young French officer who had been with
Kennedy. Most unfortunately the ice floe on which he was, with some
men, got adrift. It was never known exactly what happened, but he must
have slipped off the ice and was drowned. Lieut. Cresswell and his party
went home in the Phoenix.
Mindful of the possibility that Captain Collinson might reach
Melville Island in the Enterprise, Captain Kellett built a large house, 40
feet by 14, of stone with a wooden roof covered with painted canvas, in
which a depôt was placed of seven months’ provisions for sixty men, and
a cairn was built on Dealy Island, 42 tons of stone being used in its
construction.