Gross Domestic Product (GDP)

The video tutorial explains GDP as a measure of economic health, detailing its definition, components, and calculation methods. It distinguishes between final and intermediate goods, and discusses capital goods' role in GDP. The tutorial also covers GDP's limitations, such as not accounting for nonmarket activities or negative externalities, and introduces alternatives like the Human Development Index. Despite its flaws, GDP remains a primary economic metric due to its clarity and ease of measurement.

What does GDP stand for in macroeconomics?

• Gross Development Product

• Global Domestic Product

• General Domestic Production

• Gross Domestic Product

Which of the following is considered a final good?

• Butter purchased by a chef

• A cake sold to a customer

• Flour used by a baker

• Sugar bought by a confectioner

What is a capital good?

• A good that is consumed immediately

• A good used to make other goods but not sold again

• A good that is imported

• A good used to make other goods and sold again

How is real GDP different from nominal GDP?

• Real GDP is measured in current prices

• Real GDP is adjusted for inflation

• Real GDP includes nonmarket activities

• Real GDP excludes government spending

Which of the following is NOT a limitation of GDP?

• It measures the underground economy

• It doesn't account for nonmarket activities

• It doesn't consider the distribution of goods

• It doesn't adjust for leisure time

What is GDP per capita?

• GDP divided by the number of businesses

• GDP divided by the number of goods produced

• GDP divided by the number of services

• GDP divided by the population

Which index is NOT an alternative to GDP for assessing economic health?

• Human Development Index

• Genuine Progress Indicator

• Global Production Index

• Inclusive Wealth Index