Question Details

GDP counts only final goods and services because this



1) In computing GDP, it is essential to
A) avoid double counting.
B) include government transfer payments.
C) include government tax revenues.
D) count all intermediate products directly as they are produced.

2) Double counting (counting the same thing twice) in GDP accounting is avoided by not including
A) net exports.
B) intermediate goods.
C) illegal activities.
D) depreciation.

3) GDP counts only final goods and services because this
A) method avoids including any goods that are produced this year and sold next year.
B) method avoids double counting of goods going through several stages of production.
C) amount can be more easily determined in the marketplace.
D) method avoids understating the value of GDP produced during a given year.
4) The circular flow model shows that consumer goods and services produced by business firms
are sold in the
A) goods market.
B) factor market.
C) labor market.
D) financial market.
5) The factor market can best be described as where
A) households buy goods and services.
B) firms buy goods and services.
C) firms buy the services of labor, land and capital.
D) governments sell goods and services.




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