Gross Domestic Product

1. What does GDP stand for?

A) Global Domestic Production
B) General Development Plan
C) Government Debt Projection
D) Gross Domestic Product

2. Which of the following is included in GDP?

A) Savings rate
B) Income inequality
C) Stock market index
D) Government spending

3. What is the formula for calculating GDP?

A) GDP = Consumption + Investment - Government Spending + Net Exports
B) GDP = Consumption + Investment + Government Spending - Net Exports
C) GDP = Consumption + Investment + Government Spending + Net Exports
D) GDP = Consumption x Investment x Government Spending x Net Exports

4. What does GDP per capita measure?

A) Average economic output per person in a country
B) GDP growth rate
C) Government budget surplus
D) Total sales of a country

5. What is the difference between real GDP and nominal GDP?

A) Nominal GDP includes government spending, while real GDP does not
B) Real GDP adjusts for inflation, while nominal GDP does not
C) Real GDP ignores exports, while nominal GDP includes them
D) All GDP calculations are the same

6. Which country has the largest GDP in the world as of 2021?

A) United States
B) China
C) Germany
D) Japan

7. What could cause an increase in GDP but not lead to economic growth?

A) Rise in unemployment rate
B) Decrease in government spending
C) Inflation
D) Drop in consumer spending

8. What is the significance of calculating Real GDP as opposed to Nominal GDP?

A) Nominal GDP is always higher than Real GDP
B) Real GDP accounts for inflation, providing a more accurate measure of economic output
C) Real GDP is used only for developed countries
D) Nominal GDP includes government expenditures, making it higher

9. What is the main limitation of using GDP as a measure of economic well-being?

A) It does not account for distribution of income
B) It fluctuates due to changes in exchange rates
C) It ignores the services sector
D) It includes all forms of government spending

10. Which term is used to describe a period of negative economic growth for two consecutive quarters?

A) Stagflation
B) Depression
C) Recession
D) Inflation

11. How often is GDP typically reported in most countries?

A) Quarterly
B) Biannually
C) Monthly
D) Annually

12. What is the significance of Net Exports in GDP calculation?

A) Net Exports account for the difference between exports and imports, affecting the overall GDP
B) Net Exports have no impact on GDP
C) Net Exports reflect the income earned from overseas investments
D) Net Exports represent the total government spending internationally

13. What does the expenditure approach to GDP calculation measure?

A) Total value of all goods and services produced
B) Total spending on final goods and services
C) Total imports and exports
D) Total income earned in an economy

14. What does the GDP deflator measure?

A) The ratio of nominal GDP to real GDP
B) The unemployment rate
C) Income inequality
D) Import prices

15. GDP can be used to compare the economic performance of countries, but what must be taken into consideration when doing so?

A) Geographical area
B) Population size
C) Number of languages spoken
D) Time zones

16. What is the relationship between GDP and standard of living?

A) Higher GDP always means higher standard of living
B) GDP provides an indication of a country's economic output, but standard of living considers factors like health, education, and income distribution
C) Standard of living is not relevant to GDP
D) GDP directly determines the standard of living

Created with That Quiz — where test making and test taking are made easy for math and other subject areas.