The GDP Price Index

question 35

Multiple Choice

The GDP price index:

• A)measures the average price of final goods and services produced in an economy.
• B)measures the quality of goods produced in an economy.
• C)is derived using the prices of only imported and exported goods and services.
• D)is derived using the implicit prices of goods and services produced by the government.
• E)measures the value of all intermediate goods and services sold in an economy.

---

Definitions:

Opportunity Cost

The consequence in terms of lost benefits from not selecting the immediate next preferable option when making a choice.

Productivity

The measure of the efficiency of a person, machine, factory, system, etc., in converting inputs into useful outputs.

Terms of Trade

The ratio at which a country's exports are exchanged for imports, influencing the level of a country's economic health and prosperity.

World Price

The price at which a good is traded on the world market; determined by the world demand and world supply for the good.