GDP Cheat Sheet 2026

The 30 highest-yield GDP facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. Personal saving in national income accounting equals: → Disposable income minus personal consumption expenditures
2. Which approach to measuring GDP sums wages, profits, rents, and interest across the economy? → Income approach
3. Inventory investment is classified under which GDP component? → Gross Private Domestic Investment (I)
4. A landlord sells an apartment building originally constructed in 2010. What portion of the 2025 sale price is included in 2025 GDP? → None; the structure was counted when built in 2010
5. How does GDP handle the depreciation of capital goods over time? → Gross GDP does not subtract depreciation; Net Domestic Product (NDP) does
6. The 'value-added' method avoids double-counting in GDP by: → Summing the difference between each firm's sales and its intermediate input purchases
7. Foreign remittances sent by US immigrants to family abroad are excluded from US GDP because: → They are transfer payments that do not purchase US-produced goods or services
8. When the BEA releases its 'advance' GDP estimate, it is based on: → Roughly two-thirds of the data, with estimates filling the rest
9. Which phase of the business cycle is characterized by rising unemployment, falling consumer spending, and declining GDP? → Contraction
10. An economist observes that real GDP has grown 4% but nominal GDP has grown only 2%. This implies: → Deflation of approximately 2%
11. Which of the following would cause GDP per capita to rise even if total GDP stays constant? → A decline in population
12. An economy has: C = $12T, I = $3T, G = $4T, X = $2T, M = $2.5T. What is GDP? → $18.5T
13. In national income accounting, 'rental income' as measured by the BEA includes: → Rent paid plus the imputed rental value of owner-occupied housing
14. Which leading economic indicator is most commonly used to predict upcoming business cycle turning points? → New orders for consumer goods
15. If a country's real GDP growth rate is negative for two consecutive quarters, economists call this a: → Recession
16. Underground (black market) economic activity is generally excluded from official GDP because: → It is not reported or measured by official statistical agencies
17. A central bank uses a 2% inflation target. Which measure would it most commonly use to track this target in the US? → PCE deflator
18. Which combination of factors best explains the 'East Asian economic miracle' of rapid GDP growth in the late 20th century? → High savings rates, export-oriented policies, and heavy investment in education
19. Intermediate goods are excluded from GDP to avoid: → Double-counting the value already embedded in final goods
20. If a currency's PPP-implied value is significantly higher than its current market exchange rate value, this most directly suggests the currency is: → Undervalued in currency markets
21. If real GDP grows at 3% and the GDP deflator rises at 4%, then nominal GDP growth is approximately: → 7%
22. Government unemployment insurance payments are excluded from GDP because they: → Are transfer payments not tied to current production
23. If the GDP deflator falls from one year to the next, this indicates: → Deflation in the overall economy
24. How does the treatment of a foreign tourist's hotel spending differ between GDP and GNP calculations for the host country? → It is included in GDP (domestic production) but not directly in GNP
25. A company sells its old factory equipment to another firm for $2 million. How does this affect GDP? → It has no effect because used capital goods are excluded
26. Real GDP per capita is considered a better welfare measure than total real GDP because: → It accounts for how output is distributed across the population
27. From a long-run growth perspective, why might policymakers in a heavily foreign-invested country monitor GNP growth more carefully than GDP growth? → GNP reveals how much of the growth actually benefits domestic residents vs. foreign owners
28. The net value of Gross Domestic Product after deducting depreciation from it is _______. → Net Domestic Product
29. The GDP deflator is best described as: → The ratio of nominal GDP to real GDP multiplied by 100
30. Which price index tends to show higher measured inflation when new, cheaper substitute goods enter the market? → CPI