Types of GDP AFCAT Questions

AFCAT Indian Economy

Types of GDP MCQ Questions


7.
In the expenditure method formula for GDP, the symbol 'I' generally represents:
A.
Imports of goods and services from other countries
B.
Income tax collected by the government
C.
Investment expenditure, that is, spending by businesses on capital goods such as machinery, buildings, and inventories
D.
Interest paid by the government on its public debt
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ANSWER :
C. Investment expenditure, that is, spending by businesses on capital goods such as machinery, buildings, and inventories
8.
GDP is described as 'Gross' (rather than 'Net') mainly because:
A.
It does not deduct depreciation (the value of capital assets used up or worn out during the production process)
B.
It only includes the income earned by the government sector
C.
It is always a larger figure than a country's total national debt
D.
It includes only goods sold in bulk quantities
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ANSWER :
A. It does not deduct depreciation (the value of capital assets used up or worn out during the production process)
9.
The growth rate of GDP over successive years is most commonly used by economists and policymakers as:
A.
The primary headline indicator of a country's overall economic growth and performance
B.
A direct measure of a country's population growth rate
C.
A measure of a country's literacy rate
D.
A measure of a country's average rainfall
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ANSWER :
A. The primary headline indicator of a country's overall economic growth and performance
10.
For purposes of computing national income, the Indian economy is conventionally divided into which three broad sectors?
A.
Primary sector (such as agriculture, forestry, fishing, and mining), Secondary sector (such as manufacturing, construction, and electricity), and Tertiary sector (services, including trade, banking, and transport)
B.
Urban sector, Rural sector, and Tribal sector only
C.
Public sector, Private sector, and Cooperative sector only
D.
Domestic sector, Foreign sector, and Government sector only
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ANSWER :
A. Primary sector (such as agriculture, forestry, fishing, and mining), Secondary sector (such as manufacturing, construction, and electricity), and Tertiary sector (services, including trade, banking, and transport)
11.
GDP per capita is calculated by dividing a country's total GDP by its population, while 'per capita income' is conventionally calculated by dividing the country's national income (NNP at factor cost) by its population. The key reason these two figures can differ is that:
A.
Per capita income is calculated only for the richest citizens of a country
B.
National income additionally accounts for net factor income from abroad and excludes depreciation, neither of which is reflected in plain GDP figures
C.
GDP and national income are always exactly identical for every country, so the two figures can never differ
D.
GDP per capita is always measured in a foreign currency, unlike per capita income
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ANSWER :
B. National income additionally accounts for net factor income from abroad and excludes depreciation, neither of which is reflected in plain GDP figures
12.
Under India's national accounts framework introduced with the 2011-12 base year, Gross Value Added (GVA) at basic prices is related to GDP at market price through the formula:
A.
GDP at Market Price = GVA at Basic Prices divided by Net Factor Income from Abroad
B.
GDP at Market Price = GVA at Basic Prices minus Depreciation only
C.
GVA at Basic Prices and GDP at Market Price are always exactly equal, with no adjustment required
D.
GDP at Market Price = GVA at Basic Prices plus Taxes on Products minus Subsidies on Products
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ANSWER :
D. GDP at Market Price = GVA at Basic Prices plus Taxes on Products minus Subsidies on Products