#1
Which of the following is included in the calculation of Gross Domestic Product (GDP)?
Government spending
ExplanationGovernment spending contributes to GDP calculation.
#2
Which of the following is a part of the expenditure approach to calculating Gross Domestic Product (GDP)?
Personal consumption expenditures
ExplanationPersonal consumption is part of the expenditure approach to GDP.
#3
Which of the following is an example of a non-market transaction in the calculation of National Income?
Producing your own vegetables for personal consumption
ExplanationPersonal vegetable production for consumption is non-market.
#4
Which of the following is considered a capital expenditure in National Income Accounting?
Purchase of machinery by a firm
ExplanationMachinery purchase by firms is a capital expenditure.
#5
What is the formula for calculating Personal Income in National Income Accounting?
National Income - Corporate Profits
ExplanationPersonal Income is National Income minus Corporate Profits.
#6
What is the formula for calculating Net National Product (NNP)?
GDP - Depreciation
ExplanationNNP subtracts depreciation from GDP.
#7
Which of the following is NOT a component of National Income?
Sales tax
ExplanationSales tax is not considered part of National Income.
#8
What does the term 'Real GDP' refer to in National Income Accounting?
GDP adjusted for inflation or deflation
ExplanationReal GDP accounts for inflation or deflation adjustments.
#9
Which of the following is considered an indirect tax in the context of National Income?
Sales tax
ExplanationSales tax is an indirect tax in National Income context.
#10
What is the primary difference between Gross National Product (GNP) and Net National Product (NNP)?
Depreciation
ExplanationThe primary difference is accounted for by depreciation.
#11
In National Income Accounting, what is the significance of the term 'Double Counting'?
Counting income twice in the calculation of GDP
ExplanationDouble Counting involves counting income twice in GDP calculation.
#12
What does GNP stand for in the context of National Income Accounting?
Gross National Product
ExplanationGNP represents Gross National Product.
#13
In the context of National Income, what does the term 'Factor Income' refer to?
Income earned by factors of production (land, labor, capital)
ExplanationFactor Income is earned by land, labor, and capital.
#14
What is the relationship between Gross Domestic Product (GDP) and Gross National Product (GNP)?
GDP = GNP + Net factor income from abroad
ExplanationGDP equals GNP plus net factor income from abroad.
#15
In National Income Accounting, what does the term 'Disposable Income' represent?
Total personal income after taxes
ExplanationDisposable Income is personal income after taxes.
#16
Which of the following is included in the calculation of National Income but not in Gross Domestic Product (GDP)?
Depreciation
ExplanationDepreciation is included in National Income but not in GDP.
#17
What does the term 'Nominal GDP' refer to in the context of National Income Accounting?
GDP measured in current market prices
ExplanationNominal GDP is GDP measured in current market prices.