In Calculating GDP, We Must

question 103

Multiple Choice

In calculating GDP, we must

• A)add the market value of imports and subtract the market value of exports.
• B)add the market value of exports and subtract the market value of imports.
• C)exclude net exports of goods and services (NX).
• D)subtract the market value of imports, because these goods are produced in a country other than the United States, and subtract the market value of exports, because these goods are consumed in a country other than the United States.
• E)add the value of the goods produced outside of the United States by American firms.

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Definitions:

Multiple Periods

Refers to accounting or financial analysis over several time frames, such as quarters or years, to evaluate performance or investments.

Double-Declining-Balance Depreciation

A method of accelerated depreciation where the asset's book value is reduced at double the rate of traditional straight-line depreciation.

Straight-Line Depreciation

A method of allocating an asset's cost evenly across its useful life.

Income Tax Rate

This is the percentage at which an individual or corporation is taxed on their income.