Measuring Economic Performance

What is GDP

• The overall rise in prices for on particular product over a period of time

• The method used to measure inflation rates

• The amount of money America has

• The amount in dollars of all final goods and services produced in a country in a year

True or false: People living in countries with a high GDP always have a better-than-average quality of life.

• True

• False

True or False: GDP includes products produced by American companies outside of the United States.

• True

• False

What is inflation?

• The average level of prices for all goods and services in the economy

• A general increase in overall prices

• A good estimate of a country's production of goods and services

• The amount in dollars of all final goods and services produced in a country in a year

How is the rate of inflation measured?

• GDP growth

• Interest rates

• Financial stability

• Consumer Price Index

What is Real GDP

• GDP adjusted for inflation

• Average GDP of all countries

• GDP divided by population

• Growth of GDP

How does the government combat the effects of inflation on people living on fixed income?

• Create cost of living increases

• offer low interest rates on loans

• lower taxes for senior citizens

• offer low-income programs

True or False: High inflation rates causes interest rates to rise.

• True

• False

True or false: High inflation rates encourages borrowers to borrow more money

• True

• False

True or False: High inflation usually causes people to spend less money.

• True

• False