According to Economists,changes in the Quality of Goods

question 171

Multiple Choice

According to economists,changes in the quality of goods

• A) leads to overestimates of the measured value of GDP because these goods last for shorter amounts of time
• B) leads to underestimates of the measured value of GDP because these goods last for shorter amounts of time
• C) leads to overestimates of the measured value of GDP because these goods last for longer amounts of time
• D) have no effect on the measured value of GDP
• E) leads to underestimates of the measured value of GDP because these goods last for longer amounts of time

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Definitions:

Sale

is the transaction between two parties where the ownership of goods, services, or assets is transferred from the seller to the buyer for a specified price.

Acquisition Differential

The difference between the purchase price of a subsidiary and the fair value of its identifiable net assets at the acquisition date, commonly known as goodwill.

Consolidated Equity

The total equity of a parent company and its subsidiaries after intercompany balances and transactions have been eliminated.

Equity Method

An accounting technique used in consolidating financial statements whereby an investment is initially recorded at cost and subsequently adjusted to reflect the investor's share of the investee's net income or losses.