Because GDP Does Not Account for Improvements in the Quality

question 111

Multiple Choice

Because GDP does not account for improvements in the quality of goods, the GDP calculation:

• A) tends to overstate the true value of output in the United States.
• B) tends to understate the true value of output in the United States.
• C) provides an accurate value of output in the United States.
• D) provides the best measure of output in the United States.
• E) measures the value correctly because price changes always capture the value of quality changes.

Appreciate the advantages and disadvantages of consumer credit.

Understand the general principles of measuring credit capacity.

Identify what creditors evaluate during a credit application process.

Know strategies to protect against credit card fraud.

---

Definitions:

Equipment Services Department

A division within an organization responsible for maintaining, repairing, and ensuring the operational efficiency of machinery and equipment.

Fabrication

The process of constructing products by combining diverse materials through various manufacturing techniques.

Assembly Departments

Specific areas or segments in a manufacturing facility where components are assembled into final products.

Margin

The difference between the selling price of a product and its cost, expressed as a percentage of the selling price.