Th2.1: Problems of Using GDP to Compare SOL Flashcards
1
Q
What is the first problem of using GDP to compare SOL?
A
inaccuracy of data
2
Q
What are the first 3 ways that data can be inaccurate?
A
- inefficient at collecting or calculating data
- black market
- ## home-produced services
3
Q
What are the other 3 ways data can be inaccurate?
A
- inflation rate
- methods used to calculate GDP
- transfer payments
4
Q
What is the second problem of using GDP to compare SOL?
A
inequalities - income distribution changes and varies
5
Q
What is the third problem of using GDP to compare SOL?
A
quality of goods and services - context
6
Q
What is the fourth problem of using GDP to compare SOL?
A
comparing different currencies
7
Q
What is the fifth problem of using GDP to compare SOL?
A
spending - some spending increases GDP but not standard of living
8
Q
What are all the problems of using GDP to compare SOL?
A
- inaccuracy of data
- inflation rate
- inequalities
- quality of goods and services
- comparing different currencies
- spending
