Question

1. Gross domestic product (GDP) equals the ____ of final_____ produced within a country during a given period of time A) quantity; goods and services B) market value; goods C) market value; goods and services D) market value; services
2. GDP is a measure of an economy's: A) domestic price level. B) total output C) level of unemployment D) domestic productivity
3. Suppose that the total production of an economy consists of 4 oranges and 10 candy bars, each orange sells for $0.25, and each candy bar sells for $0.50. What is the market value of production in this economy?

A) $6.00                       B) $0.75                       C) $5.00                      D) $1.00

4. A drawback of using market values to aggregate the quantities of goods and services produced in an economy is that:
5. 1. not all economically valuable goods and services are bought and sold in markets.
   2. market prices generally reflect the economic benefit consumers expect to receive from an item.
   3. higher-priced items count more.
   4. GDP increases when not all goods are produced in greater quantities.

Answer 1

1.C) Market value,goods and services

Gross domestic product equals the market value of final goods and services produced within a country during a given period of time.

2.B) Total output

GDP is a measure of an Economy's total output

3.A) $ 6

Market value of production

= $ 0.25 × 4 + 0.50× 10

=$ 1 +$ 5

= $ 6

4.A) Not all economically valuable good and services are bought and sold in market.

By including the market values we are excluding many goods and services that are produced outside of a formal market .the purpose of using market values is to count higher price items more.A) GDP will increase when some goods are produced more and others are produced less that is not a drawback of market values.b) Finally market prices generally reflect the economic benefit but it's the best we have (c)