SIE practice questionmediumGDP
Gross Domestic Product (GDP) measures:
- AThe total market capitalization of all publicly traded companies
- BThe total national debt of a country
- CThe difference between a country's exports and imports
- DThe total value of all goods and services produced within a country during a specific period✓ Correct answer
Explanation
Why D — The total value of all goods and services produced within a country during a specific period
GDP is the total market value of all final goods and services produced within a country's borders during a specific time period (usually a quarter or year). It is the broadest measure of economic activity. Choice C describes the trade balance (net exports), which is just one component of GDP. GDP = Consumption + Investment + Government Spending + Net Exports (C + I + G + NX). GDP is a coincident economic indicator.
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