Countries a and B Have the Same GDP

question 29

Multiple Choice

Countries A and B have the same GDP.In country A,people eat often in restaurants,but in country B people eat more often at home.Therefore

• A)economic activities are underestimated in country A.
• B)economic activities are overestimated in country B.
• C)GDP represents accurate measure of economic activities in both countries.
• D)GDP is underestimated in country B.

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Definitions:

Standard Overhead Rate

A predetermined rate applied to estimate the cost of a product’s indirect expenses such as manufacturing or production overheads.