Quiz on GDP and Unemployment

What does GDP measure?

• The total value of all goods and services in a country

• The total market value of all final goods and services produced within a country's borders in a given time period

• The total income of all citizens in a country

• The total value of exports minus imports

Which of the following is NOT included in the calculation of GDP?

• Consumer spending

• Government spending

• Investments

• Transfer payments

Why are intermediate goods excluded from GDP calculations?

• To avoid double counting

• Because they are not important to the economy

• To simplify calculations

• Because they are not produced within the country's borders

Which of the following would be considered part of the underground economy?

• A teenager mowing lawns for cash

• A restaurant selling meals

• A factory producing cars

• A bank providing loans

What is the definition of an unemployed person in economic terms?

• Anyone without a job

• Adults not working but actively seeking work

• People who have given up looking for work

• Part-time workers looking for full-time jobs

What is considered the natural rate of unemployment for full employment?

• 0-1%

• 2-3%

• 5-6%

• 10-12%

How is the cost of living defined?

• The average income in a given area

• The cost of maintaining a certain standard of living

• The price of essential goods and services

What is inflation?

• A decrease in the overall price level

• An increase in the value of money

• A general and sustained increase in prices

• A rapid growth in GDP

What is considered a "healthy" rate of inflation?

• 0%

• 2-3%

• 5-6%

• 10%

Which of the following is NOT excluded from GDP calculations?

• Second-hand sales

• Non-market transactions

• Exports

• Underground economy activities