#1
Which of the following is NOT a commonly used indicator of economic growth?
Consumer Price Index (CPI)
ExplanationCPI measures inflation, not economic growth.
#2
What does GDP stand for?
Gross Domestic Product
ExplanationGDP measures the total economic output of a country.
#3
What is the term used to describe the total value of all goods and services produced within a country's borders in a specific period?
Gross Domestic Product (GDP)
ExplanationGDP measures the economic activity within a nation's borders.
#4
Which of the following is a common method to measure economic growth?
GDP per capita
ExplanationGDP per capita accounts for population growth, providing a per-person measure of economic performance.
#5
Which of the following is an example of an intermediate good?
Steel purchased by a car manufacturer
ExplanationIntermediate goods are used in the production process of other goods.
#6
What is the formula to calculate GDP?
Consumption + Investment + Government Spending + (Exports - Imports)
ExplanationGDP is calculated by summing up all expenditures in the economy.
#7
What is the difference between economic growth and economic development?
Economic growth refers to an increase in GDP while economic development refers to improvements in living standards and well-being
ExplanationEconomic development encompasses broader aspects beyond GDP.
#8
Which of the following is an example of a leading economic indicator?
Consumer Confidence Index
ExplanationCCI forecasts changes in economic activity.
#9
Which of the following is a measure of income inequality?
Gini coefficient
ExplanationGini coefficient quantifies the distribution of income among individuals.
#10
What is the term used to describe a period of economic decline when GDP contracts?
Recession
ExplanationRecession involves negative economic growth over two consecutive quarters.
#11
What is the term used to describe the rate at which the general level of prices for goods and services is rising?
Inflation
ExplanationInflation erodes purchasing power over time.
#12
Which of the following is a limitation of using GDP as a measure of economic well-being?
It doesn't account for income distribution
ExplanationGDP does not reflect how wealth is distributed among citizens.
#13
What is the main purpose of using real GDP instead of nominal GDP?
Real GDP accounts for changes in the price level, providing a more accurate measure of economic output
ExplanationReal GDP adjusts for inflation, giving a clearer picture of economic performance.
#14
Which of the following is an example of a lagging economic indicator?
Unemployment rate
ExplanationUnemployment rate reflects past economic performance.
#15
What is the relationship between economic growth and the production possibilities frontier (PPF)?
Economic growth shifts the PPF outward, indicating an increase in the economy's potential output
ExplanationEconomic growth expands the possibilities for production.
#16
Which of the following is a characteristic of a developed economy?
High per capita income
ExplanationDeveloped economies have high standards of living and income.
#17
What is the primary goal of economic policy?
Achieving full employment
ExplanationFull employment minimizes wasted resources in the economy.
#18
What is the term used to describe a sustained period of falling prices across the economy?
Deflation
ExplanationDeflation reduces consumer spending and investment.