Question Details

Gross domestic product can be calculated



1) Total output and total income in the circular flow model
A) are measures of the economyʹs level of savings.
B) include only intermediate goods.
C) are equal to each other.
D) are related because national income is less than national product.
2) The circular flow shows that
A) aggregate production equals aggregate expenditure.
B) aggregate expenditure is less than aggregate income.
C) GDP equals aggregate income.
D) Both answers A and C are correct.
3) Comparing aggregate expenditure and aggregate incomes shows that
A) aggregate expenditure is usually greater than aggregate income.
B) aggregate income is usually greater than aggregate expenditure.
C) they are equal.
D) aggregate income can not equal aggregate expenditure if we have any savings.
4) Gross domestic product (GDP) is
A) the value of all final goods and services produced in a country during a year.
B) the sum of consumption expenditure, investment, government expenditure on goods and
services, and net exports.
C) the sum of compensation of employees, proprietorsʹ income, net interest, rental income,
corporate profits, depreciation, and indirect business taxes minus subsidies.
D) all of the above
5) Gross domestic product can be calculated
A) either by valuing the nationʹs output of goods and services or by valuing the income
generated in the production process.
B) by adding up the personal consumption of all members of the society.
C) by adding up the value of all intermediate goods used in the economy.
D) by adding up the income tax returns of all members of the society.





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