Question

Gross domestic product was designed to measure which of the following (choose all that apply):

Question 31 options:

	Whether economic growth is positive or negative.
	Whether growth is accelerating or decelerating.
	Whether growth is high or low relative to the trend.
	Where the economy is in relation to the business cycle.

Answer 1

Gross Domestic Product is the value of all the final goods and services produced in the economy during a period of one year.

The purpose to design the gross domestic product was to know how the value of final goods and services produced in the Economy is changing over the period and across several periods.

Gross Domestic Product also helps us ascertain whether the economic growth is positive or negative which we can find by looking at the previous period's Gross Domestic Product.

If we can find whether the economic growth is positive or negative we can tell whether growth is accelerating or decelerating as get to know the Rate of Growth through the GDP.

By looking at the gross domestic products across several periods of an economy we can also find where the economy is in relation to the business cycle.

Hence, first, second and fourth options would be applied.