Which of the Following Is a Problem When Comparing GDPs

question 51

Multiple Choice

Which of the following is a problem when comparing GDPs per capita between nations?

• A) GDP per capita only measures income distribution.
• B) Fluctuations in exchange rates affect differences in GDP per capita.
• C) GDP per capita is subject to greater measurement errors for IACs compared to LDCs.
• D) GDP per capita is likely overstated in LDCs due to families producing goods and services outside of the pricing system.

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Definitions:

Acquisition

The process of acquiring control over another company, either through the purchase of its shares or assets.

Intragroup Transaction

Transactions that occur between two entities within the same group of companies, often needing elimination during consolidation for accurate financial reporting.

NCI Adjustment

Adjustments made to reflect the share of earnings or losses attributable to non-controlling interests in a subsidiary.

Tax Rate

is the percentage at which an individual or corporation is taxed by the government on their income or profit.