Which of the Following Correctly States the Relationship Between GDP

question 169

Multiple Choice

Which of the following correctly states the relationship between GDP and GNP for the U.S.?

• A) GDP equals GNP minus the net income of foreigners.
• B) GDP equals GNP plus the net income of foreigners.
• C) GDP equals GNP minus indirect business taxes.
• D) GDP equals GNP.

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Definitions:

Paid-in Capital

Funds received by a company from investors in exchange for stock, representing the capital that stockholders have invested in the company.

Common Stock

A type of equity security that represents ownership in a corporation, giving holders voting rights and a share in the company’s profits through dividends.

Par Value

The nominal value of a bond, stock, or other security, as stated by the issuer upon issuance.

Discount

A reduction applied to the usual cost of goods, services, or invoices, often to encourage prompt payment or increase sales.