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Questions and Answers
What is the main purpose of government spending according to the text?
What is the main purpose of government spending according to the text?
- To provide public goods and safety like infrastructure, education, and healthcare (correct)
- To increase the country's GDP through exports
- To make factor payments to households for land, labor, capital, and entrepreneurship
- To earn income from taxes and licenses
Where does the government get the money for its spending according to the text?
Where does the government get the money for its spending according to the text?
- From factor payments received from households
- From the country's exports
- From the country's GDP
- From taxes and licenses paid by firms, households, and foreigners (correct)
How does spending by foreigners on a country's goods and services affect that country's GDP?
How does spending by foreigners on a country's goods and services affect that country's GDP?
- It only affects the country's exports, not its GDP
- It increases the country's GDP because the money is flowing into the economy (correct)
- It decreases the country's GDP because the money is spent on foreign goods and services
- It has no effect on the country's GDP
What is the income approach to GDP according to the text?
What is the income approach to GDP according to the text?
What is the formula for calculating GDP using the expenditure approach?
What is the formula for calculating GDP using the expenditure approach?
What is the definition of imports according to the text?
What is the definition of imports according to the text?
Which of the following is NOT a component of GDP in the expenditure approach?
Which of the following is NOT a component of GDP in the expenditure approach?
What does the 'C' term represent in the GDP equation?
What does the 'C' term represent in the GDP equation?
What is the purpose of calculating GDP using the expenditure approach?
What is the purpose of calculating GDP using the expenditure approach?
What does the 'I' term represent in the GDP equation?
What does the 'I' term represent in the GDP equation?
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