GRADE 11 ECONOMICS.
GDP WORKSHEET
SECTION A: multiple choice questions
1.
Which one of the following is NOT a method of calculating GDP?
A.
B.
C.
D.
2.
If the GDP for a given period is divided by the size of the population for that same
period, it is known as …
A.
B.
C.
D.
3.
real GDP
GDP at factor cost
per capita GDP
GDP at market prices
Suppose that in the country of Xanadu, the real gross national product in 2004 was
R1883 billion. In 2005, real gross national product was R1610 billion. In Xanadu,
real gross national product grew by
A.
B.
C.
D.
5.
Value added method
Income method
Savings method
Expenditure method
14.5 percent
17.0 percent
-14.5 percent
-17.0 percent
In a small regional farming sector in a given year, farmers sell potatoes to factories
for R10m. Factories then manufacture and sell frozen chips and crisps to
supermarkets for R17m. Supermarkets sell these frozen chips and crisps to
consumers for R21m
From this information we can conclude that
A.
B.
C.
D.
5.
the value added by the farmers is R12m during the year
the total value added is R21m
the total value added is R48m
the value added by the factories is R11m during the year
Which of the following statements is correct?
A.
B.
C.
D.
net investment minus depreciation equals gross investment
gross investment plus net investment equals depreciation
net investment equals gross investment minus depreciation
gross investment equals net investment minus depreciation
6.
The following information is taken from the national accounts of Zambibia:
C
I
G
X
Z
= R200 million
= R50 million
= R150 million
= R200 million
= R180 million
Gross Domestic Expenditure is
A.
B.
C.
D.
R400 million
R420 million
R600 million
R380 million
SECTION B: direct questions
1.
Define “Gross Domestic Product”
2.1
Calculate the value added to production using the figures below which were taken
from a firm’s income and expenditure statement.
[2]
Wages and salaries
Rent paid
Interest paid
Intermediate goods and services
Revenue from sales
[2]
R20,000
R5,000
R3,000
R8,000
R43,000
2.2.
Using figures from the table above, explain “double counting” and why it is
important to avoid it when compiling the national accounts.
[3]
3.
Study the table below which gives figures for a hypothetical economy and answer
the questions which follow:
Investment expenditure
Government expenditure
Imports
Capital consumption
Indirect taxes on products and production
Consumption expenditure
Indirect subsidies on products and production
Exports
Compensation to employees
Factor income receipts from abroad
Factor income payments abroad
R400
R600
R50
R200
R25
R2,000
R30
R100
R2,400
R85
R120
Showing all your working, calculate:
3.1.
GDP (at market prices).
[3]
3.2.
NDP (at market prices).
[2]
4.
You have to measure the nominal GDP for a country in the three ways shown
above with the given information.
Production in Nambabwe(1995)
Total clothing production
R2 million
Total salaries
R15 million
Total sheep production
R1 million
Total expenditure on housing
R17 million
Total housing production
R17 million
Total wages
R5 million
Total expenditure on clothes
R2 million
Total expenditure on meat
R1 million
Total cloth production
(used in the production of clothes)
R0.5 million
a) Calculate GDP using the output-method, and provide an explanation for the
items you include in the calculation.
b) Explain the concept of double-counting. In the example, which item should be
left out so as to avoid the problem of double-counting?
c) Calculate GDP using the income method, and provide an explanation for the
items you include in the calculation.
d) Calculate GDP using the expenditure method, and provide an explanation for
the items you include in the calculation.
5.
a) To make one piece of furniture, the carpenter buys wood at R324.56, but sells
the item for R650. The timber mill paid the farmer R198.76 for the raw material.
What is the correct amount for the inclusion in the national income figures?
b) Which two methods/rules could one use to be absolutely certain that the correct
amount is being included in the national figures?
6.
A Dalton sugar farmer burns and cuts his cane crop of 4 hectares at 100 tons of
cane per hectare. He transports it to the Noodsburg Sugar Mill where he receives
an amount of R900 per ton of sucrose extracted from the sugar cane. A good cane
crop delivers about 14% sucrose per ton of sugar cane.
The sugar mill processes the cane and delivers a range of products that are passed
on in the production chain to the wholesaler. The sugar is packaged and sold to
retail outlets for R150 000. The combined price to the end consumers is a mark-up
of 60% on the cost to the retailer.
Calculate the value added in the above example. Tabulate your answer
showing both the selling price and the value-added at each stage in the
production process.
7.
Sweetdream Island is a closed economy in which the inhabitants make a living from
producing sugar and cakes only. As the Finance Minister on the island you need to
calculate the national income figures for publishing in the next release of
government figures.
Using the production, expenditure and income methods, set up three tables
incorporating the following information to help you arrive at the national
income figure for this quarter.
The wheat farmers sell their crop to the millers for R2000 and their wages amount
to R800, leaving profit at R1200. The millers sell all their flour to the bakeries on
Sweetdream Island for R6000. They claim R1500 in wages and therefore their
profit was R2500. The bakeries sell their cakes to the public for R10 000. Wages
amounted to R2200 and profit to R1800.
The sugar farmers receive R1000 for their produce with wages adding up to R400
and profit R600. The sugar mills process the cane and sell the outcome to the
wholesalers for R3000. Wages amount to R1200: the sugar mills’ combined profit
was therefore R800. The middlemen sell their sugar products to retailers for R12
000. Wages are R3500 and profit is R5500. Finally the retailers sell the sugar to
the public for R24 000 with wages being R5000 and therefore profit equals R7000.
8.
The total production of a shoe factory is sold for R500 000. Compensation to
employees is R300 000. The value of the factory machinery depreciates by R80
000 during the production process. The net operating surplus amounts to R120
000.
a) The GDP at factor cost in regard to the shoes is:
i.
ii.
iii.
9.
R420 000
R500 000
R380 000
How are Gross National Product figures converted to Gross Domestic Figures?