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