For a Given Level of GDP, an Increase in Net

question 148

Multiple Choice

For a given level of GDP, an increase in net factor earnings from abroad will:

• A) increase gross national product.
• B) reduce gross national product.
• C) not affect disposable personal income.
• D) increase a nation's trade surplus.

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Definitions:

Inventory Cost Flow

An accounting method that determines the value of sold inventory and ending inventory, can be FIFO, LIFO, or Average Cost.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue. It represents the company's bottom line.

Rising Prices

An economic situation characterized by a general increase in the prices of goods and services.

Dollar-Value LIFO

An inventory valuation method that uses the dollar value of inventory rather than the physical count of goods, adjusting for inflation.