Lesson 56 - unit 12

Question 1

What is the gross domestic product?

Answer 1

The market value of a nation’s total domestic output of all final goods and services over a period of time.

Question 2

What is the gross national product?

Answer 2

The production of a nation’s permanent residence (can occur within the country or elsewhere).

Question 3

What 2 ways can GDP be calculated?

Answer 3

By totaling all expenditures or by totaling all income.

Question 4

What is considered a healthy annual rate of growth in the GDP?

Answer 4

3%

Question 5

What is the difference between the nominal GDP and the real GDP?

Answer 5

The nominal GDP is the actual total figure, while the real GDP expresses output in terms of the previous year’s dollar value to account for inflation.

Question 6

What is Purchasing Power Parity (PPP)?

Answer 6

It takes into account the differences in cost of living in various countries by using the long-term exchange rate.

Question 7

What are some factors the GDP doesn’t show?

Answer 7

1. The status of individual industries
2. How wealth is distributed among the population
3. The value of wives and mothers working at home, caring for the sick and elderly, or volunteer work
4. The quality of life factors such as leisure time, environmental quality, literacy, or personal health.

Question 8

What is Patrick Toomey’s basic argument about the overall, long term trend of the American economy?

Answer 8

The previous 25 years have been the greatest period of prosperity in history.

Question 9

What does Toomey cire as the 3 most important forms that the expansion of economic freedom has taken in recent years?

Answer 9

1. Reduced tax rates
2. Deregulation
3. Freer international trade

Question 10

How did Toomey see both major political parties failing in their rhetoric during the election year of 2008?

Answer 10

Democrats wanted to reverse the trend of economic freedom and Republicans were timid about defending the ideas that had caused increased prosperity.