In Any Year, the Real GDP of an Economy

question 13

Multiple Choice

In any year, the real GDP of an economy

• A) always equals potential GDP.
• B) may be greater or less than potential GDP.
• C) will always be greater than potential GDP because of the tendency of developed nations to incur inflation.
• D) must always be less than potential GDP.

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Definitions:

Total Indirect NCI

Refers to the total non-controlling interest in a consolidated financial statement that arises from subsidiaries owned indirectly through other subsidiaries.

Retained Profits

Earnings not distributed to shareholders and held back by the company for reinvestment or to pay off debt.

Ultimate Parent

The highest level or top company in a corporate structure, which holds control over all subsidiary companies within the group.