Practice Test GeeksGDP - Gross Domestic Product Practice Test
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Calculation Flashcards

7 cards from real GDP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

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  1. Nominal GDP differs from Real GDP in that Nominal GDP:

    Answer: Is measured at current prices without adjusting for inflation

    Nominal GDP uses current-year prices and therefore reflects both output changes and price level changes.

  2. If Nominal GDP is $22T and the GDP deflator is 110, what is Real GDP?

    Answer: $20T

    Real GDP = (Nominal GDP / GDP Deflator) × 100 = ($22T / 110) × 100 = $20T.

  3. The GDP deflator is calculated as:

    Answer: (Nominal GDP / Real GDP) × 100

    The GDP deflator = (Nominal GDP ÷ Real GDP) × 100, measuring the overall price level relative to a base year.

  4. If real GDP grew from $18T to $19.8T, what was the real GDP growth rate?

    Answer: 10%

    Growth rate = ($19.8T - $18T) / $18T × 100 = 10%.

  5. Which best describes the difference between GDP and GNP?

    Answer: GDP counts output within borders; GNP counts output by a country's residents regardless of location

    GDP is location-based (within borders), while GNP (now called GNI) is residency-based (citizens/firms wherever they produce).

  6. A steel company sells $400 of steel to an automaker, which sells $1,200 of cars to consumers. Using the value-added method, GDP contribution is:

    Answer: $1,200

    GDP counts only the final value of $1,200 (or equivalently, $400 value added by steel + $800 value added by automaker = $1,200).

  7. Per capita GDP is calculated by:

    Answer: Dividing total GDP by the total population

    Per capita GDP = GDP ÷ Population, providing a rough measure of average living standards.