The Expenditure Approach to Measuring GDP

question 247

Multiple Choice

The expenditure approach to measuring GDP

• A) adds the dollar value of final goods and services.
• B) adds the income received by all factors of production.
• C) excludes durable consumer goods since they last more than a year.
• D) excludes profits since profits are a cost of production.

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Definitions:

Functional Currency

The chief monetary unit in the leading economic area where an organization conducts operations, utilized in its financial statements.

Financial Statements

Structured reports that detail the financial performance, position, and cash flows of a business.

Exchange Rates

The rate at which one currency can be exchanged for another currency, which can fluctuate based on market conditions.

Statement of Retained Earnings

A financial document outlining the changes in retained earnings over a specific period, including net income and dividends paid.