Is GDP an Accurate Measure of a Country's Well Being

question 20

Multiple Choice

Is GDP an accurate measure of a country's well being?

• A)Yes, it is the best measure of national well being.
• B)Yes, provided we use real GDP and not nominal GDP.
• C)The answer is uncertain, depending on whether GDP is rising or falling.
• D)No, it is not.

Understand the concept of social efficiency and how market prices can misrepresent societal value.

Understand the concepts of market efficiency and equity.

Recognize the causes and consequences of market failure.

Identify examples of negative externalities and public goods.

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Definitions:

Maturity Date

The date on which a financial obligation must be repaid or settled in full.

Leap Years

Years that are divisible by 4 (except for years divisible by 100, unless they are also divisible by 400), having 366 days to keep the calendar year synchronized with the astronomical year.

Maturity Value

The total amount that will be received at the maturity date of an investment, including the principal and any accrued interest.

365-Day Year

A method used in finance calculations that assumes all years have 365 days for the purpose of simplifying interest calculations.