National Income Accounting Quiz

Test your understanding of national income concepts with this macroeconomics quiz. Includes questions on GDP, GNP, and more. Take the quiz now!

Practice Learn Test

Which of the following is not a component of national income?

Personal income

Net exports

Government spending

Gross investment

GDP stands for:

Gross Domestic Product

Government Development Plan

General Domestic Policy

Growth and Development Projection

What is the main difference between GDP and GNP?

GDP includes net income earned abroad, while GNP does not

GDP only includes income earned within a country's borders, while GNP includes income earned abroad

GDP measures the total output of goods and services, while GNP measures the total income of a nation

There is no difference between GDP and GNP

What is the difference between Gross Domestic Product (GDP) and Gross National Product (GNP)?

GDP includes foreign income earned by domestic residents, while GNP does not

GNP includes foreign income earned by domestic residents, while GDP does not

GDP measures the total output of goods and services, while GNP measures the total income of a nation

There is no difference between GDP and GNP

Which of the following statements is true about the circular flow of income in an economy?

It only includes flows of money between households and businesses

It includes flows of goods and services but not money

It represents the continuous flow of income and spending between households and businesses

It does not apply to closed economies

Which of the following is included in the calculation of Gross National Product (GNP)?

Exports

Imports

Net foreign income

Government spending

What does the term 'Disposable Income' refer to?

Total income earned by individuals before taxes

Income left after paying taxes and other mandatory deductions

Total income of a nation excluding foreign income

Income earned by government through taxes

Which of the following equations represents the expenditure approach to calculating GDP?

GDP = C + I + G + (X - M)

GDP = Wages + Rent + Interest + Profit

GDP = GDP at factor cost - Depreciation

GDP = National income + Indirect taxes - Subsidies

What does the term 'Net National Product (NNP)' account for?

Depreciation

Indirect taxes

Subsidies

Growth rate

#10

Which of the following items would be counted in the calculation of GDP?

A used car sold by a private individual

Government transfer payments

Stock market transactions

An unsold car sitting in a dealership's lot

#11

What does the term 'Real GDP' account for?

Inflation

Nominal GDP only

Population growth

Changes in price levels

#12

Which of the following is not a limitation of GDP as a measure of economic welfare?

Excludes non-market transactions

Ignores income distribution

Does not consider quality of life factors

Does not account for environmental degradation

#13

What is the formula for calculating Gross Domestic Product (GDP) using the income approach?

GDP = C + I + G + (X - M)

GDP = GDP at market price - Indirect taxes + Subsidies

GDP = Compensation of employees + Gross operating surplus + Gross mixed income + Taxes - Subsidies

GDP = Net National Product + Depreciation

#14

What does the term 'National Income' represent?

Total income earned by all individuals and businesses within a country

Income earned by a nation through exports

Total income earned by a nation's residents, regardless of location

Income earned by a nation's government through taxes

#15

Which of the following is an example of an intermediate good?

A loaf of bread purchased by a consumer

Steel purchased by an automobile manufacturer

A computer purchased by a student for personal use

A house purchased by a family for residential purposes