Types of GDP AFCAT Questions

AFCAT Indian Economy

Types of GDP MCQ Questions


1.
GDP is based on which of the following criteria for deciding what to include?
A.
The currency in which the goods are sold
B.
The nationality of the company's owners, regardless of where production actually takes place
C.
The geographical location where production takes place, regardless of the nationality or residency of the producer
D.
The age of the machinery used in production
😑 View Answer Rough Work Error
ANSWER :
C. The geographical location where production takes place, regardless of the nationality or residency of the producer
2.
Output produced within a country by a foreign-owned company operating a factory in that country is:
A.
Included only in the GDP of the foreign company's home country
B.
Included in that country's GDP, since GDP is based on the location of production, not the nationality of the producer
C.
Excluded entirely from that country's GDP
D.
Counted twice, once in each country's GDP
😑 View Answer Rough Work Error
ANSWER :
B. Included in that country's GDP, since GDP is based on the location of production, not the nationality of the producer
3.
Income earned by a country's own residents from investments or work located in a foreign country is:
A.
Irrelevant to all national income calculations of any kind
B.
Excluded from that country's GDP, since GDP only counts production occurring within the country's own domestic territory
C.
Counted as a negative value in that country's GDP
D.
Always included in that country's GDP, regardless of where it was earned
😑 View Answer Rough Work Error
ANSWER :
B. Excluded from that country's GDP, since GDP only counts production occurring within the country's own domestic territory
4.
GDP at market price can be converted into GDP at factor cost using the formula:
A.
GDP at Factor Cost = GDP at Market Price plus Net Indirect Taxes
B.
GDP at Factor Cost = GDP at Market Price plus Depreciation
C.
GDP at Factor Cost = GDP at Market Price minus Net Indirect Taxes (Indirect Taxes minus Subsidies)
D.
GDP at Factor Cost = GDP at Market Price minus Net Factor Income from Abroad
😑 View Answer Rough Work Error
ANSWER :
C. GDP at Factor Cost = GDP at Market Price minus Net Indirect Taxes (Indirect Taxes minus Subsidies)
5.
Conversely, GDP at market price can be obtained from GDP at factor cost using the formula:
A.
GDP at Market Price = GDP at Factor Cost plus Net Factor Income from Abroad
B.
GDP at Market Price = GDP at Factor Cost minus Depreciation
C.
GDP at Market Price = GDP at Factor Cost plus Net Indirect Taxes (Indirect Taxes minus Subsidies)
D.
GDP at Market Price = GDP at Factor Cost minus Net Indirect Taxes
😑 View Answer Rough Work Error
ANSWER :
C. GDP at Market Price = GDP at Factor Cost plus Net Indirect Taxes (Indirect Taxes minus Subsidies)
6.
Under the expenditure method, GDP is calculated using which of the following formulas?
A.
GDP = Total Tax Revenue minus Total Government Expenditure
B.
GDP = Wages plus Profits only, with no other components
C.
GDP = Total Population multiplied by Average Wage
D.
GDP = Private Consumption Expenditure + Investment Expenditure + Government Expenditure + Net Exports (Exports minus Imports)
😑 View Answer Rough Work Error
ANSWER :
D. GDP = Private Consumption Expenditure + Investment Expenditure + Government Expenditure + Net Exports (Exports minus Imports)