AP Human Geography : Gross Domestic Product

Study concepts, example questions & explanations for AP Human Geography

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Example Questions

Example Question #1 : Gross Domestic Product

Which of the following would not be a factor in calculating a nation's Gross Domestic Product (GDP)?

Possible Answers:

The total amount spent by the nation's consumers

The revenue the nation generates from taxes

The income made by the nation's farmers

The total amount of revenue created by companies based in the nation

The average wage of a worker in the nation

Correct answer:

The average wage of a worker in the nation

Explanation:

The gross domestic product is one of the chief ways a nation's economy is judged. As its name implies, the GDP is a total accounting of a nation's output, including all expenditures, revenues, and profits. Any average, like the average wage, plays no part in GDP, because GDP measures a complete output by a nation.

Example Question #2 : Gross Domestic Product

How does the Gross Domestic Product differ from the Gross National Product?

Possible Answers:

The Gross National Product takes into account foreign investments; the Gross Domestic Product does not.

The Gross Domestic Product takes into account purchasing power; the Gross National Product does not.

The Gross National Product takes into account purchasing power; the Gross Domestic Product does not.

The Gross Domestic Product takes into account foreign investments; the Gross National Product does not.

The Gross Domestic Product takes into account degradation of natural resources; The Gross National product does not.

Correct answer:

The Gross National Product takes into account foreign investments; the Gross Domestic Product does not.

Explanation:

The Gross Domestic Product is very similar to Gross National Product except for one important distinction, the Gross National product takes into account foreign investments, whereas the Gross Domestic Product does not. For this reason most economic geographers consider the Gross National Product to be a slightly more useful statistic than the Gross Domestic Product.

Example Question #3 : Gross Domestic Product

Which of these was created to account for flaws in the Gross National Product?

Possible Answers:

Purchasing Power Parity.

Human Development Index.

Net National Product.

All of these answers are correct.

Gross Domestic Product.

Correct answer:

Purchasing Power Parity.

Explanation:

The statistic of Purchasing Power Parity was created by geographers and economists to account for flaws in the Gross National Product - namely that the Gross National Product does not reflect how far the same amount of money goes in different countries around the world.

Example Question #4 : Gross Domestic Product

Which of these countries eschews Gross National Product in favor of Gross National Happiness?

Possible Answers:

Thailand

Seychelles

Niger

Albania

Bhutan

Correct answer:

Bhutan

Explanation:

Bhutan is a small country in the Himalayan region of Asia that has eschewed the Gross National Product metric in favor of Gross National Happiness. The government contends that countries should be measured by how content and comfortable their citizens are rather than the aggregate sum of their riches, or industrial production.

Example Question #3 : Gross Domestic Product

Most geographers consider Purchasing Power Parity to be a necessary addendum to any analysis of Gross National Product because it __________.

Possible Answers:

Considers the impact that government policies have on the growth of the economy

Takes into account how much of a country’s economic value is derived from speculation

Takes into account how far money goes in individual country's economies

Considers the impact that economic growth has on the environment

All of these answers are correct  

Correct answer:

Takes into account how far money goes in individual country's economies

Explanation:

The primary problem with the Gross National Product is that it presents the value of all economies based on the value of the US dollar. It ignores the fact that in different countries varying amounts of goods can be purchased with the same amount of money. For example, a house in New Jersey might cost you several hundred thousand dollars, in Lesotho it might cost you less than a thousand dollars. This basically means that an individual needs to earn less money to buy the same amount of goods. This distinction is reflected in Purchasing Power Parity (PPP).

Example Question #6 : Gross Domestic Product

The monetary value in US dollars of all the goods, services, and investments produced by a country in a year is called __________.

Possible Answers:

Purchasing Power Parity

the Gross Domestic Product

the Net Natural Product

the Gross National Product

the Human Development Index

Correct answer:

the Gross National Product

Explanation:

The Gross National Product is one of the most widely used and quoted statistics in economic geography, particularly in popular parlance. It refers to the total monetary value, in US dollars, of all the goods, services, and investments produced by a country in a year.

Example Question #4 : Gross Domestic Product

Which of these is least strongly correlated with Gross National Product?

Possible Answers:

Income

None of these are strongly correlated with Gross National Product.

Literacy

Gender equity

Life expectancy

Correct answer:

Gender equity

Explanation:

In truth all of these are extremely strongly correlated with Gross National Product. But, income (obviously), life expectancy, and literacy rates are all more strongly correlated than is gender equity. This is because some countries, such as Italy in Europe, much of the Middle East, and Japan score far higher on measures like Gross National Product than they do on gender equity.

Example Question #8 : Gross Domestic Product

Which of these measurements of economic development takes into account the monetary value of all the goods, services, and investments produced by a country in a year and then subtracts the the value of the loss of natural resources caused by that production?

Possible Answers:

Gross Domestic Product

Net Natural Product

Gross National Product

Purchasing Power Parity

Human Development Index

Correct answer:

Net Natural Product

Explanation:

The Net Natural Product differs quite significantly from the other statistics used to measure relative economic development in a country because it takes into account the loss of natural resource caused by the productivity of the country. As such it is a natural favorite of environmental economic geographers.

Example Question #5 : Gross Domestic Product

What is the value of the total output of goods and services produced in a country in a given time period (often one year)?

Possible Answers:

GNP - Gross National Product

GDI - Gross Domestic Income

GNI - Gross National Income

GDP - Gross Domestic Product

Correct answer:

GDP - Gross Domestic Product

Explanation:

The easiest way to figure this out is with vocabulary: primarily income vs. product. We know from the prefix in- that income deals with what is coming into the country. That leaves us with either Gross Domestic Product or Gross National Product. However, Gross National Product deals with the market value of the goods that have been produced by a country, not the actual amount of goods. Think of the two as quantitative vs. qualitative; GDP deals with how many goods were produced, while GNP deals with how much those same goods are worth. 

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