An Example of How GNP Accounts for Services Provided by Foreign-Owned

question 23

Multiple Choice

An example of how GNP accounts for services provided by foreign-owned capital (and GDP does not) is

• A) earnings of a Spanish factory with British owners counts only in Spain's GDP.
• B) earnings of a Spanish factory with British owners counts only in Britain's GNP.
• C) earnings of a Spanish factory counts in Spain's GNP but are part of Britain's GDP.
• D) earnings of a Spanish factory counts in Spain's GDP but are part of Britain's GNP.
• E) earnings of a Spanish factory counts in Spain's GNP but not in Britain's GDP or GNP.

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Definitions:

Primacy and Recency Effects

Psychological terms describing the tendency to remember information that appears at the beginning (primacy) and end (recency) of a list better than information in the middle.

Memory

The cognitive process of encoding, storing, and retrieving information.

Retrieval

The process of accessing and bringing into conscious awareness information stored in memory.

Stored Information

Information that is retained in the brain or another storage system for retrieval and use at a later time.