This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting – Quiz 11 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 11 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. National production means goods and services produced within the borders of a nation during a specified period. A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: A) TRUE. 2. What is the formula for calculating Net National Product (NNP)? A) GNP + Depreciation. B) GDP-Depreciation. C) GNP-Depreciation. D) GDP + Depreciation. Show Answer Correct Answer: C) GNP-Depreciation. 3. Net exports are included in which of the following? A) GNP but not GDP. B) GDP but not GNP. C) Both GNP and GDP. D) Neither GNP nor GDP. Show Answer Correct Answer: A) GNP but not GDP. 4. An American buys a Japanese car, paying by writing a check on an account with a bank in New York. How would this be accounted for in the balance of payments? A) Current account, a Japanese good import. B) Current account, a U.S. good import. C) Financial account, a U.S. asset import. D) Financial account, a U.S. asset export. E) A current account as a U.S. good import and a financial account, a U.S. asset export. Show Answer Correct Answer: E) A current account as a U.S. good import and a financial account, a U.S. asset export. 5. Between 2014 and 2019, the world's economy total real product grew at an annual average rate of nearly ..... percent per year. A) 3.5. B) 3.9. C) 2.9. D) 2.5. Show Answer Correct Answer: A) 3.5. 6. Movements in GDP A) Differ greatly from movements in GNP. B) Do not differ greatly from movements in GNP. C) Are not allowed to differ at all from movements in GNP by definition. D) Need to be inflation adjusted in order to match movements in GNP. E) None of the above. Show Answer Correct Answer: B) Do not differ greatly from movements in GNP. 7. Disposable personal income can best be defined as ..... A) The actual income received by households. B) Income received by household after deducting personal taxes. C) Income received by resource suppliers for their current contribution to ptoduction. D) None of the above. Show Answer Correct Answer: B) Income received by household after deducting personal taxes. 8. Which of the following is not one of the classifications of factor incomes? A) Compensation of employees. B) Subsidies. C) Mixed income. D) Operating surplus. Show Answer Correct Answer: B) Subsidies. 9. An example of a Government spending flow would be A) Building roads. B) Wages. C) Transfer payments. D) Subsidies. Show Answer Correct Answer: A) Building roads. 10. Why are the intermediate goods not included in the National Income while measuring National Income? A) To avoid double accounting. B) It decreases income. C) Intermediate goods are not good. D) All of these. Show Answer Correct Answer: A) To avoid double accounting. 11. Calculate Net value added at factor cost from the following data:Items-Rs. (in lakhs)1. Purchase of machinery to be used in the production unit-1002. Sales-2003. intermediate cost-904. Indirect taxes-125. Change in stock-106. excise duty-67. stock of raw material-5 A) Rs. 282 lakhs. B) Rs. 182 lakhs. C) Rs. 108 lakhs. D) Rs. 208 lakhs. Show Answer Correct Answer: C) Rs. 108 lakhs. 12. When will the NI be greater than DFI? A) Net factor income from abroad is zero. B) Net factor income from abroad is positive. C) Net factor income from abroad is negative. D) None of the above. Show Answer Correct Answer: B) Net factor income from abroad is positive. 13. Net national product does not include ..... A) Interest on consumer loans. B) Undistributed corporate profit. C) Taxes on corporate profits. D) Depreciation. Show Answer Correct Answer: D) Depreciation. 14. Assess the consequences of a decrease in exports on a country's balance of payments. A) Trade deficit increases. B) Trade surplus increases. C) No impact on balance of payments. D) Increase in imports. Show Answer Correct Answer: A) Trade deficit increases. 15. Which of the following is added to national income while calculating personal income? A) Transfer payments to individuals. B) Social security contributions. C) Corporate taxes. D) Undistributed profits. Show Answer Correct Answer: A) Transfer payments to individuals. 16. The income that is received by individuals and households in an economy in a year. A) Personal income. B) Disposable Personal Income. C) Per Capita Income. D) Real National Income. Show Answer Correct Answer: A) Personal income. 17. What is the main problem associated with the Expenditure Method? A) Market Price Measure vs. Factor Loss Measure. B) Market Price Measure vs. Factor Profit Measure. C) Market Price Measure vs. Factor Cost Measure. D) Market Price Measure vs. Factor Income Measure. Show Answer Correct Answer: C) Market Price Measure vs. Factor Cost Measure. 18. When will GDP at market price be equal to GDP at factor cost? A) Indirect taxes=subsidy. B) Indirect taxes >subsidy. C) Indirect taxes < subsidy. D) None of these. Show Answer Correct Answer: A) Indirect taxes=subsidy. 19. Which of the following is an example of STOCKS? A) Capital. B) Value addition. C) Savings. D) Both capital and savings. Show Answer Correct Answer: A) Capital. 20. Government transfer payments like social security and unemployment benefits are A) Included in government purchases. B) Not included in government purchases. C) Not included in government purchases, but they are included in the consumption component of GNP. D) Not included in government purchases, but they are part of the investment component of GNP. E) None of the above. Show Answer Correct Answer: B) Not included in government purchases. 21. An example of how GNP accounts for services provided by foreign-owned capital (and GDP does not) is A) Earnings of Spanish factory with British owners counts only in Spain's GDP. B) Earnings of Spanish factory with British owners counts only in Britain's GNP. C) Earnings of Spanish factory counts in Spain's GNP but are part of Britain's GDP. D) Earnings of Spanish factory counts in Spain's GDP but are part of Britain's GNP. E) None of the above. Show Answer Correct Answer: D) Earnings of Spanish factory counts in Spain's GDP but are part of Britain's GNP. 22. Comparing national income between ASEAN countries is difficult mainly due to: A) Similar culture and traditions. B) Different economic structures and population sizes. C) Equal education levels. D) Shared natural resources. Show Answer Correct Answer: B) Different economic structures and population sizes. 23. To adjust from Net National Product to Gross National Product: A) Add depreciation. B) Deduct indirect taxes. C) Add subsidies. D) Add inflation. Show Answer Correct Answer: A) Add depreciation. 24. What does Disposable Personal Income (DPI) refer to? A) Total income before taxes. B) Income after personal direct taxes. C) Income from investments. D) Income from government grants. Show Answer Correct Answer: B) Income after personal direct taxes. 25. What is the purpose of adjusting GDP to Real GDP? A) To account for inflation. B) To account for population changes. C) To exclude government spending. D) To include nonmarket activities. Show Answer Correct Answer: A) To account for inflation. ← PreviousNext →Related QuizzesClass 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 1Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 2Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 3Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 4Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 5Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 6Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 7Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 8Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 9Class 12 Economics (Macro Economics) Chapter 2 National Income Accounting Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books