Components of GDP

When calculating GDP, which of the following is subtracted?

• government spending
• export spending
• import spending
• investment by business

Illegal goods and services that are produced are...

• included as an estimate in GDP
• included in GDP when the authorities can prove the amount
• included in the consumption category of GDP
• not counted in GDP

If the government hires a private company to fix a road, then...

• GOP doesn't change b/c taxpayers are paying the bill
• GDP doesn't change b/c the government isn't building new roads
• GDP increases
• GDP decreases

Cash you earn from babysitting...

• is counted as consumption in GDP
• is not counted in GDP b/c it's not reported on tax forms
• not counted in GDP b/c it's a transfer payment
• included in investment sector of GDP if you save it

Total market value of all final goods and services produced annually in a country is called

• real gross domestic product
• gross domestic product & gross national product
• gross national product
• gross domestic product

You buy a hamburger from a local fast food store

• counts in GDP as consumption
• counts in GDP as investment
• not counted in GDP b/c it's a minor purchase
• not counted in GDP since it's considered an intermediate good

If a product is produced by not purchased, it

• is not counted in GDP
• is counted in GDP
• is added to GDP, then subtracted at the end of the year
• lowers GDP

Why doesn't GDP count intermediate goods?

• the intermediate value may have different stages
• intermediate value cannot be calculated
• intermediate value is calculated into GNP
• intermediate value is included in the value of the final good

Components of GDP are...

• consumption, investment, government purchases, and foreign exchange market
• consumption, investment, government purchases, and export spending minus import spending
• consumption, investment, transfer payments, and imports
• consumption, investment, the money supply, and government purchases

General Motors buys new automated equipment for use in building cars. This falls under...

• consumption
• investment
• government spending
• export spending