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