When Comparing GNP to GDP, It Is Correct to Say

question 111

Multiple Choice

When comparing GNP to GDP, it is correct to say that

• A) GNP is a better indicator of economic progress than GDP.
• B) GNP treats activities that harm our quality of life as costs and gives them negative values.
• C) GNP is a better measure of economic growth for advanced industrial countries, but GDP is a better measure for developing countries.
• D) the activities required to clean up an oil spill are not included in the calculation of GDP.
• E) none of these is correct.

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Definitions:

Budget Line

A depiction in graphic form of every achievable combination of two commodities that can be acquired based on a specified financial capacity and pricing.

Indifference Curve

An economic graph representing combinations of goods that give a consumer equal satisfaction and utility.

Subjective Value

The individual and personal valuation of a good or service rather than its market value, based on personal preferences, needs, or satisfaction derived.

Equilibrium

A balance between market demand and supply that results in steady prices.