The Base- Year Method of Calculating Real GDP Compared

question 35

Multiple Choice

The base- year method of calculating real GDP compared

• A) quantities produced in different years using prices from a year chosen as a reference period.
• B) prices at different points in time using a sample of goods that is representative of goods purchased by households.
• C) the quantities of goods produced in consecutive years using prices in both years and averaging the percentage changes in the value of output.
• D) quantities produced in different years with the prices that prevailed during the year in which the output was produced.

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Definitions:

Completion of Sale

This term signifies the point at which a transaction is finalized, and all conditions for the sale have been satisfied, transferring ownership from seller to buyer.

Equity

The amount of ownership interest in an asset or business, after deducting all debts associated with that asset.