Write \'T\' if the statement is true and \'F\' if the statement is false. GDP is

Question

Write 'T' if the statement is true and 'F' if the statement is false. GDP is not a complete measure of well-being. Choose the one alternative that best completes the statement or answers the question. The measure of production that values production using current prices is called Gross national product is defined as The measure of production that values output using base-year prices is called If real GDP increases we know for sure that A very simple economy produces three goods movies, burgers, and bikes. The quantities produced and their corresponding prices for 2006 and 2011 are shown in the table above. What is nominal GDP in 2006? What is real GDP in 2011, using 2006 as the base year? The size of the underground economy as a percent of GDP is larger in the United States as compared to poorer countries such as Zimbabwe.

Explanation / Answer

22. True.

GDP is not a complete measure of well being becuase it does not incorporates the price level in the economy. ITs an absolute measure.

23. Option C is correct.

Nominal GDP takes into account only the value of goods and services at the current prices.

24. Option B is correct.

GNP includes the value of goods and services produced within the domestic economy and the income earned by an overseas investment less then income earned by the foreigners within the domestic economy.

25. Real GDP.

Real GDP incorporates the vaue of goods and services calculated at the base prices.

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