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Gross Domestic Product (GDP) - Test
  • 1. What does GDP stand for?
A) Global Development Program
B) Gross Domestic Product
C) Government Debt Percentage
D) General Distribution Process
  • 2. Inflation-adjusted GDP is also known as:
A) Real GDP
B) Per capita GDP
C) Nominal GDP
D) Potential GDP
  • 3. Which sector of the economy includes farming and mining?
A) Primary sector
B) Quaternary sector
C) Secondary sector
D) Tertiary sector
  • 4. GDP can be calculated by summing:
A) Investment + Taxes - Imports + Exports
B) Consumption + Savings + Exports - Imports
C) Consumption + Investment + Government Spending + Net Exports
D) Income + Consumption + Net Exports - Government Spending
  • 5. Which component of GDP reflects the value of exports minus imports?
A) Consumption
B) Government spending
C) Investments
D) Net exports
  • 6. What is the difference between GDP and GNP?
A) GDP is adjusted for inflation, while GNP is not
B) GDP includes government spending, while GNP does not
C) GDP measures wealth, while GNP measures income
D) GDP measures economic output within a country, while GNP measures output by country's residents worldwide
  • 7. Which organization releases GDP data for the United States?
A) IMF
B) World Bank
C) Federal Reserve
D) Bureau of Economic Analysis (BEA)
  • 8. How does government spending impact GDP?
A) Decreases GDP by reducing consumer spending
B) Has no impact on GDP
C) Negatively impacts GDP by raising taxes
D) Increases GDP through direct expenditures
  • 9. When GDP growth rate is negative for two consecutive quarters, it is known as:
A) Recession
B) Stagnation
C) Depression
D) Expansion
  • 10. What is the largest component of GDP in most economies?
A) Government spending
B) Net exports
C) Consumption
D) Investments
  • 11. What is nominal GDP useful for?
A) Measuring the distribution of income within a country.
B) Comparing national economies using current exchange rates.
C) Calculating the cost of living differences between countries.
D) Adjusting for inflation over time.
  • 12. What is one limitation of GDP as a measure?
A) It includes all forms of economic activity, including illegal ones.
B) It measures only the agricultural sector's output.
C) It does not account for how income is distributed among the population.
D) It always increases with inflation.
  • 13. What adjustment is often made to GDP figures for cross-country comparisons?
A) Adjustment based on population size.
B) Adjustment by the number of natural resources.
C) Adjustment according to military expenditure.
D) Adjustment using purchasing power parity (PPP).
  • 14. In which year did Simon Kuznets first develop the modern concept of GDP?
A) 1993
B) 1944
C) 1991
D) 1934
  • 15. In the expenditure approach, what does 'M' represent?
A) Imports
B) Monetary policy
C) Money supply
D) Market demand
  • 16. What alternative economic indicator is mentioned as a better measure of human development?
A) The Human Development Index (HDI).
B) Net exports.
C) Nominal GDP.
D) GDP per capita.
  • 17. When did the United States switch from GNP to GDP?
A) 1944
B) 1991
C) 1934
D) 1993
  • 18. In what year did the Bretton Woods Conference take place, leading to GDP becoming a main tool for measuring economies?
A) 1993
B) 1991
C) 1944
D) 1934
  • 19. Which country is mentioned as having a high GDP per capita during apartheid but unequal wealth distribution?
A) China.
B) United States.
C) South Africa.
D) India.
  • 20. How often is GDP typically measured in most countries?
A) Monthly.
B) Every quarter.
C) Annually.
D) Biannually.
  • 21. Which economist highlighted the exclusion of unpaid work in GDP calculations?
A) John B. Cobb.
B) Martha Nussbaum.
C) Diane Coyle.
D) Erik Brynjolfsson.
  • 22. What phenomenon describes GDP's treatment of money spent on repairs as beneficial?
A) Deflationary bias
B) Broken window fallacy
C) Economic paradox
D) Inflation illusion
  • 23. Who further developed the method of GDP in 1695?
A) Milton Gilbert
B) Sir William Petty
C) Charles Davenant
D) Simon Kuznets
  • 24. What percentage of climate policy researchers support post-growth according to a recent survey?
A) 85%
B) 50%
C) 73%
D) 60%
  • 25. For what purpose did Sir William Petty develop the concept of GDP?
A) To develop it for a U.S. Congress report.
B) To calculate the tax burden and argue landlords were unfairly taxed during warfare between the Dutch and the English.
C) To measure a country's economic performance.
D) To warn against its use as a measure of welfare.
  • 26. Which of the following approaches is considered the most direct method for determining GDP?
A) Income approach
B) Production approach
C) Speculated expenditure approach
D) Expenditure approach
  • 27. What alternative GDP measurement accounts for welfare value?
A) GNH Index.
B) GEP.
C) ISEW.
D) GDP-B.
  • 28. What does the United Nations aim to address through its Sustainable Development Goals?
A) Political liberties.
B) Wealth inequality.
C) GDP growth rates.
D) Income distribution within countries.
  • 29. Which country is noted for strong GDP growth but restricted political liberties?
A) South Africa.
B) China.
C) India.
D) United States.
  • 30. Which organization did not contribute to the preparation of SNA2008?
A) International Monetary Fund
B) European Union
C) United Nations
D) World Bank
  • 31. In what year did the Commission on the Measurement of Economic Performance and Social Progress publish a proposal to expand focus beyond GDP?
A) 2025
B) 1980
C) 2013
D) 2009
  • 32. Who initially came up with the concept of GDP?
A) Charles Davenant
B) Simon Kuznets
C) Milton Gilbert
D) Sir William Petty
  • 33. In what year did China officially adopt GDP as its economic performance indicator?
A) 1991
B) 1993
C) 1934
D) 1944
  • 34. What percentage of GDP in the UK does unpaid labor potentially account for using liberal estimates?
A) Nearly 70%.
B) Between 20% and 50%
C) Over 50%
D) About 15%
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