Which of the following is NOT included in the calculation of GDP at market prices? MCQ with Answer and Explanation

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Which of the following is NOT included in the calculation of GDP at market prices?

A. Intermediate goods

B. Net exports

C. Gross investment

D. Private consumption expenditure

Answer: Option A

Solution (By JKSSB Mock Tests)

GDP includes only final goods and services to avoid double counting. Intermediate goods are not included in GDP calculation.

This question belongs to: Economy GK Economy Set 1

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Question #1

Which of the following is a characteristic of the 'Classical Dichotomy'?

A. Money affects real output in the long run

B. Only fiscal policy is neutral

C. Real and nominal variables are always interdependent

D. Real and nominal variables are determined separately and money is neutral

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Correct Answer: Option D

Explanation:
The classical dichotomy is the proposition that real variables (output, employment, relative prices) are determined independently of nominal variables and that money is neutral in the long run.

This question belongs to: Economy GK Economy Set 1

Question #2

Demand-pull inflation is caused by:

A. an increase in production costs

B. a fall in money supply

C. aggregate demand exceeding aggregate supply at full employment

D. decrease in government expenditure

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Correct Answer: Option C

Explanation:
Demand-pull inflation occurs when aggregate demand exceeds aggregate supply.

This question belongs to: Economy GK Economy Set 1

Question #3

In the theory of international trade, the Heckscher-Ohlin theorem states that a country will export goods that:

A. Use its scarce factors intensively

B. Have the highest absolute advantage

C. Use its abundant factors intensively

D. Require the most labour regardless of endowment

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Correct Answer: Option C

Explanation:
According to the Heckscher-Ohlin theorem, a country exports goods that intensively use its relatively abundant factors of production and imports goods that intensively use its scarce factors.

This question belongs to: Economy GK Economy Set 1

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