income and expenditures In other words, economists want to study Income and expenditures GDP measures the expenditure of the economy in goods and services produced dur View the full answer Transcribed image text: Question 1 (1 point) Gross domestic product measures income and expenditures. carrots purchased at a grocery store and eaten by your family a. total income earned. With a growing passion for share market investment, Cat joined the Motley Fool Australia editing team in July 2020. Gross domestic product is defined as the total value of all assets and services produced in an economy during the given time period (within domestic boundary). d. in the United States is insignificant is size when compared to the official measure of GDP. It measures the output of an economy using constant prices. the benefit that a person receives from an expenditure by government minus the taxes that were collected by government to fund thatexpenditure The increase in the fourth quarter . Some of this spending, which is counted as C, I, and G, is spent on imported goods. 1. 3 points b. durable goods and services, but not spending on nondurable goods. QUESTION 12 c. real GDP declines for two consecutive quarters. d. U.S. net exports and GDP are unaffected, Japanese GNP increases, and German net exports, GNP, and GDP decrease. 80, and this indicates that the price level has decreased by 20 percent since the base year. For an economy as a whole For example, if more cars own cars, although the peoples' quality of life might be better, there might be more pollution in the air, affecting their health. A higher income can support people in terms of security and material comfort by purchasing inferior goods such as Tesla and Apple products. c. alter household income, but they do not reflect the economy's production. b. the second quarter but not the third quarter b. consumption must equal saving. GDP is a useful indicator of a nations economic performance, and it is the most commonly used measure of well-being. 37. income but not expenditures Real GDP measures aggregate output using constant prices, thus removing the effect of changes in the overall price level. c. both changes in prices and changes in the amounts being produced. a. GNP = GDP + Value of exported goods - Value of imported goods On this page, neither the author nor The Motley Fool have chosen a 'top share' by personal opinion. $500,000 In 2010, 1000 iPhones are sold at $300 each and 5000 pounds of bananas are sold at $3 per pound. consumption exceeded the sum of investment and government purchases during the year 49. d. $125,000, 23. c. There is no ironclad rule for the declaration of recessions. Gross domestic product adds together many different kinds of goods and services into a single measure of the value of economic activity.To do this, GDP makes use of market prices statistical estimates of the value of goods and services to consumers. $6359 GDP excludes most items that are produced and sold illegally and most items that are produced and consumed at home because Gross domestic product, or GDP, is a crucial measure of economic health. Gross domestic product, or GDP, is a measurement of economic output. d. imports, but not government expenditures. a. not included in current GDP because GDP only measures the value of goods and services produced in the current year If total spending rises from one year to the next, then Gasoline is considered a final good if it is sold by a Because of this, GDP may overstate the amount of economic activity in nations with rapidly depreciating capital stocks. The gross domestic product refers to the market value of final goods and services produced inside an economy during an particular time period usually year or quarter. a. consumption, although it might be argued that it would fit better in investment. For more information please see our Financial Services Guide. prices based on the assumption that producers make no profits 29. QUESTION 31 b. real GDP but not nominal GDP. a. All of the above are correct b. GDP accounts for all activities taking place outside markets. b. GDP is still a useful measure of society's welfare because providing these other attributes is the responsibility of government. You transfer $1,000 from your bank account to a mutual fund. To the best of our knowledge, all information in this article is accurate as of time of posting. pipeline operator to a gasoline station in San Francisco a. the quality of these items is not high enough to contribute value to GDP. I suppose GDP is usually expressed in US dollars to be able to do comparisons between countries. 38. We account for this using real GDP, which is a measure of GDP that has been adjusted for the price level. Listen to Our Podcast 88. The Motley Fool launched its Australian presence in 2011, and since then has grown to reach over 1 million Australians. How would you find the real GDP of the base year? I don't understand how growth can be overstated in real GDP because of the method it's computed. a. spending to build new houses b. transitory goods. GDP is the signature piece of BEA's National Income and Product Accounts . 3 points d. All of the above are correct. d. $1750, 70. $440 GDP measures two things at once: the total income of everyone in the economy and the total expenditure on the economys output ofgoods and services c. $2400 O income but not expenditures. $25,000 thanks Show transcribed image text Expert Answer Who are the experts? 1. gasoline station to a motorist in Los Angeles c. The purchase of ink and paper supplies by a textbook company for the production of new textbooks. a. the value of the good is added to the investment category of 2014 GDP, added to the consumption category of 2015 GDP, and subtracted from the investment category of 2015 GDP. b. included in current GDP but valued at their original prices. b. falling profits b. income but not expenditures. c. not part of GDP because it is a transfer payment. value of all final goods and services produced within a country in a given period of time An American retailer purchased 100 pairs of shoes from a company in Mexico in the second quarter of 2016 but does not sell them to a consumer until the third quarter of 2016. gasoline station to a bus company that operates a bus route between San Francisco and Los Angeles 66. Direct link to melanie's post GDP is not, strictly spea, Posted 2 years ago. Which of the following statements is correct? In 2010, 50 units of cranberries are sold at $20 per unit and 100 units of maple syrup are sold at $8 per unit. d. falling unemployment. How do you calculate? His move c. nominal GDP is $315,000, real GDP is $410,000, and the GDP deflator is 130.16. 4 Example 1.1: Income equals expenditure D c. included in GDP if Susan changes it herself, but not if she pays Speedy Lube to change it. Possible moves could include reducing exposure to cyclical stocks and increasing their investment in more defensive and recession-proof companies that arent as reliant on the economy to drive their growth. QUESTION 14 b) H0:p=0.05\mathrm{H}_0: p=0.05H0:p=0.05 vs. HA:p>0.05\mathrm{H}_{\mathrm{A}}: p>0.05HA:p>0.05 at =0.05\alpha=0.05=0.05. a 5. Gross domestic product, or GDP, is a crucial measure of economic health. Sheri, a U.S. citizen, works only in Germany. A tire manufacturer produces 400 tires valued at $20 each. Gross domestic product measures a. income and expenditures b. income but not expenditures c. expenditures but not income d. neither income nor expenditures. a. the end of a war. Some of the poorest countries in the world may actually appear poorer than they really are if we only consider their official GDP figures. a. the total income earned by a nation's permanent residents. 2013 $4.00 150 $3.00 200 Gross domestic product measures a. income and expenditures. d. corporations have earned but have not paid out to their owners. a. gasoline station to a bus company that operates a bus route between San Francisco and Los Angeles. b. nominal GDP declines for four consecutive quarters. Thoughts? Suppose the government eliminates all environmental regulations and, as a result, the production of goods and services increases, but there is considerably more pollution. Which of the following are included in her physical capital? Today it has nominal GDP of $3,000, a GDP deflator of 400, and population of 150. What was Talikastan's GDP in 2015? d. 120, and this indicates that the price level has increased by 120 percent since the base year. b. value of all goods and services produced by the citizens of a country, regardless of where they are living, in a given period of time. 1. c. final goods. wages must equal income the prices at which goods are sold in a nation in a particular year; current prices are used when calculating nominal GDP. 2010 $2.00 80 $1.00 100 a. a. GNP = GDP + Value of exported goods - Value of imported goods. Contact Details: 18. spending on business equipment such as welding equipment c. $600,000 Based on these numbers the unemployment rate was c) Calculate the GDP deflator price index for 2018. The report showed that GDP grew by 2.1% in 2022 to almost $25.5 trillion, slower than the 5.9% increase in 2021. total income earned Q3 2022 (3rd) +3.2%. If an economy's GDP falls, then it must be the case that the economy's, 8. Surely depreciation of capital is more a symptom of low growth rather than something that needs to be measured by GDP? c. 120, and this indicates that the price level has increased by 20 percent since the base year. d. national income. QUESTION 28 in both German GDP and U.S. GDP If nominal GDP doubles and the GDP deflator doubles, then real GDP businesses have left after paying taxes and non-tax payments to the government Investors should avoid or sell cyclical stocks when GDP growth is slowing. d. U.S. GNP and Bermudan GNP. In 2011, this country's real GDP was $770 3 points A professional gambler moves from a state where gambling is illegal to a state where gambling is legal. value of all final goods and services produced by the citizens of a country, regardless of where they are living, in a given period of time Gross domestic product measures a. income and expenditures. 2012 $2.00 120 $3.00 150 capital equipment, inventories, and structures, excluding household purchases of new housing a. both nominal and real GDP. 1. a. $760 d. None of the above is correct; market prices are not used in computing GDP. A For any economy, income must equal expenditure in the aggregate - Every dollar you spend (expenditure) is income for someone else. Topics include the distinction between real and nominal GDP and how to calculate and use the GDP deflator. In our educational articles, a 'top share' is always defined by the largest market cap at the time of last update. Y ( all payments to factors of prodcution) Which of the following is not included in GDP? a. part of GDP because it represents income. b. GDP necessarily decreases. c. included in the current quarter GDP as consumption. expenditure on goods. QUESTION 21 c. GDP is still a useful measure of society's welfare because it measures a nation's ability to purchase the inputs that can be used to help produce the things that contribute to welfare. The table below contains data for the country of Batterland, which produces only waffles and pancakes. a. c. goods and services produced by foreign citizens working in the U.S. 1. expenditures but not income not part of GDP because it is a transfer payment Direct link to Liam Mullany's post Surely depreciation of ca, Posted 5 years ago. b. nominal but not real GDP. A: GDP = C + I + G + X - M Where C = personal consumption expenditure I = Gross private domestic Q: Consumption $500 Government Expenditures $200 GNP $800 Gross Private Domestic Investment $100 A: Given - Consumption (C) = $500Government Expenditures (G) = $200GNP = $800Gross Private Domestic 3 points a-income and expenditures. gross domestic product (GDP), total market value of the goods and services produced by a country's economy during a specified period of time. d. then both GDP and consumption spending will be higher. b. d. All of the above are included in the investment component of GDP. d. GNP = GDP - Income earned by foreigners in the U.S. + Income earned by U.S. citizens abroad. Waffles Quantity of Waffles Price of Pancakes Quantity of d. Your employer automatically transfers $100 each month from your wages to a non-taxable medical spending account. Assume that prices remain constant. In a simple circular-flow diagram, firms use the money they get from a sale to 1. For the given situation, what is the critical value(s) for zzz or ttt? income but not expenditures 2012 $2.00 120 $3.00 150 Economists calculate GDP using four inputs: The formula for calculating GDP uses the underlined letters from above: GDP is a crucial measure of economic health. 45. This article contains general educational content only and does not take into account your personal financial situation. a. reduced measured GDP. Country B because it had the higher nominal GDP per person. a. would be included in GDP because they are part of government purchases. A recession has traditionally been defined as a period during which 3/2 times as much to GDP as the production of good B. c. It was unchanged. a payment that is automatically transferred from your bank account to pay a bill or some other obligation durable goods, nondurable goods, and services 3 points GDP minus imports When studying changes in the economy over time, economists want a measure of the total quantity of goods and services the economy isproducing that is not affected by changes in the prices of those goods and services. The table below shows the output and the prices of Switzerland in 2017 and in 2018. As much as economists like to use GDP as a measure of output, or even as a measure of a countrys well being, GDP has some limitations when trying to answer those questions. U.S. GDP and U.S. GNP are related as follows: Household spending on education is included in d. All of the above are correct. For example, in the United States, Congress could pass legislation to spur economic growth if GDP shows the economy is in a downturn. a. remains constant. A news media journalist and editor for more than 25 years, Cat has covered a diverse spectrum of current affairs and lifestyle platforms, from politics and economics to recipes and real estate. c. real but not nominal GDP. 87. Social Security payments the U.S. government makes c. not included in current GDP because it is difficult to determine their value. Many things that society values, such as good health, high-quality education, enjoyable recreation opportunities, and desirable moral attributes of the population, are not measured as part of GDP. 3 points All of the above are correct What document describes expectations for ethical behavior for an organization or professional group? QUESTION 1 A transfer payment is a. GDP is not a useful measure of society's welfare. c. You make a payment to get legal documents showing you purchased a previously owned home. 44. $1350 How much of the farmer's sales will be included as apples in GDP? 19. Recessions are not associated with which of the following? 85. Country B had a nominal GDP of $720 billion, a GDP deflator of 120 and a population of 50 million. Transfer payments $777 Real gross domestic product (GDP) increased at an annual rate of 2.6 percent in the fourth quarter of 2022, after increasing 3.2 percent in the third quarter. inventory goods D. Publish a code of conduct. GDP per person tells us the income and expenditure of the d. neither income nor expenditures. b. GDP per person. It implies that consumers arent worried about their jobs, so they spend more money on goods and services. Economic Outlook Database. 50/50. 1. c. both the market value of rental housing services and the market value of owner-occupied housing services c. the CPI in 2016 was lower than 118.0. b. slowly growing real GDP. To encourage formation of small businesses, the government could provide subsidies; these subsidies In the economy of Talikastan in 2015, consumption was $700, exports were $200, government purchases were $300, imports were $150, and investment was $400. 60. 1. Economic theory tells us that the government has little role in providing education, because individuals have the incentive to invest in their education on their own. GDP per person Post consequences to unethical behavior. 21. 52. For example if 30% of your 50,000 annual income is spent on just taxes and an extra 15% is spent on necessity, then you barely got anything left to pay rent on time let alone buy yourself some normal or luxury goods. Rising GDP shows that an economy is expanding. a. households retain after paying taxes. 1. QUESTION 2 Conduct annual training seminars on business ethics. these terms have been mentioned in the previous videos and hence not re-explained here. I believe its a typo. 1. 1. a. U.S. net factor payments from abroad are positive, and its GDP is larger than its GNP. 3 points neither the author nor The Motley Fool have chosen a 'top share' by personal . Many industries are susceptible to changes in economic or GDP growth. in German GDP, but is not included in U.S. GDP 1. Why in a) ii for cheese 8 was multiplied by 210 while in question we have 200? c. GDP is unaffected because neither the rent nor the estimate of the value owner-occupied housing services is included in GDP. This doesn't have to be directly, it can be replaced with newer technology or by the firm expanding into more profitable sectors. b. income but not expenditures. a. market prices do not change much over time, so it is easy to make comparisons between years. c. imports minus exports. c. the services of a U.S. government attorney valued at the cost of her salary 93. b. doubles. 58. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. part of GDP because the recipients must have worked in the past to qualify c. all of the variables are always positive numbers. a. excludes the amount of criminal activity in an economy. These include: Each of these indexes is a composite measure weighing both income and non-income variables such as life expectancy, literacy rates, environmental indicators, measures of inequality and so on. Pancakes In 2010, this country's nominal GDP was As share price movements on the ASX stock market typically reflect the US markets, this also can be helpful for Australian investors wanting to safeguard their investment portfolios in times of economic volatility. 1. b. decreases GDP. However, this is not the most commonly used price index for tracking inflation and deflation. d. the value of foreign goods purchased exceeded the value of goods sold to foreigners during the year. c. the total income earned by a nation's permanent residents in the production of goods and services. Unemployment compensation is Money continuously flows from households to firms and then back to households, and GDP measures this flow of money Graph and download economic data for Real Gross Domestic Product: All Industry Total in California (CARGSP) from 1997 to 2021 about GSP, CA, real, GDP, and USA. a. included in GDP whether Susan pays Speedy Lube to change it or changes it herself. Bureau of Economic Analysis. 3 points 62. 35. All of the above are correct b. Transfer payments neither income nor expenditures. Income generated by a nation's domestic production 4. Net exports equal Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show and premium investing services. Gross domestic product measures a. income and expenditures. c. $1050 a. pay rent to landlords. Even though GDP is frequently used to capture the wellbeing of a society, it was never intended to do that, and as a result it leaves out important aspects of well-being like pollution or even happiness. If unemployment is 141.6 million and the labor force is 154 million, then the number of unemployed individuals is 154-141.6. Given their nature, investors can use GDP as a guide for when to buy and sell cyclical stocks. If nominal GDP rises from one year to the next, then which of the following could not be true? measuring them is so difficult C represents household expenditures on services and durable goods. Investment news, stock ideas, and more, straight to your inbox. The Motley Fool Australia does not guarantee the performance of, or returns on any investment. Real GDP is an inflation-adjusted measure of gross domestic product. Table 23-2 1. Purchases of capital equipment $310 a. the total income of a nation's permanent residents minus losses from depreciation. d. All of the above are correct. The table below contains data for country A for the year 2010. Human Capital The next year, it produces the exact same goods, but those goods sell for $1,050 because inflation for the year is 5%. 46. 40. The inflation rate is the b. GNP = GDP - Value of exported goods + Value of imported goods. GDP is defined as. b. nominal GDP is $1800, real GDP is $2000, and the GDP deflator is 111.1. d. not included in GDP whether Susan pays Speedy lube to change it or she changes it herself. 17. b. consumption exceeded the sum of investment and government purchases during the year. Another method of calculating real GDP involves converting nominal GDP to real GDP by using the GDP deflator, which tracks price changes of a nations output over time. For example, in Canada during 2015, Real GDP is a measure of how much is actually produced. QUESTION 11 expenditures but not income Changes in nominal GDP reflect GDP measures the value of goods and services. 50/50. 6. 1. 3 points During the current quarter, a firm produces consumer goods and adds some of those goods to its inventory rather than selling them. In this way, real GDP is a truer measure of output in an economy. For an economy as a whole a-the market value of production must equal expenditure. c. rising inflation. d. the quarterly and annual approaches to the calculation of GDP. a. The government sends your grandfather his Social Security check. Join our flagship membership service, Share Advisor. Direct link to 22sabharwalv's post Higher incomes and output, Posted 3 years ago. QUESTION 20 Three hundred tires are sold to a tire shop, which then sells them to households for $50 each. However, it has some important limitations, including: Alternative indicators have been developed to provide a more well-rounded measure of a nations quality of life by different national and international organizations. Government purchases include spending on goods and services by a. the market value of rental housing services, but not the market value of owner-occupied housing services. 67. Gross domestic product measures a. income and expenditures. QUESTION 13 How much did the average price of goods produced in Switzerland change between 2017 and 2018? federal and state governments, but not by local governments c. spending on business equipment such as welding equipment (202) 606-5360. neither income nor expenditures 68. d. $700,000, 24. Direct link to Norman Southey's post How come the summary incl, Posted 4 months ago. a. included in current GDP because GDP measures the value of all goods and services sold in the current year. Australian Financial Services Licence (AFSL): 400691, The Motley Fool Australia, PO Box 104, Isle of Capri, Qld 4217. d. neither the second nor the third quarter. 1. What was Talikastan's investment in 2015? d. $1770, 71. Production of good A contributes c. the quality of the environment. 96. 64. With this index, changes in the average price level (inflation or deflation) can be calculated between years. the economy. QUESTION 25 start text, C, A, N, space, end text, dollar sign, 1, comma, 994, point, 9, start text, space, b, i, l, l, i, o, n, end text, start text, C, A, N, space, end text, dollar sign, 1, comma, 857, start text, space, b, i, l, i, o, n, end text, dollar sign, 1, comma, 857, start text, space, b, i, l, l, i, o, n, end text, dollar sign, 1, comma, 995, start text, space, b, i, l, l, i, o, n, end text, start text, C, A, N, space, end text, dollar sign, 1, comma, 994, start text, space, b, i, l, l, i, o, n, end text. a. To log in and use all the features of Khan Academy, please enable JavaScript in your browser. 42. a. unemployment benefits a state pays Suppose a country has government expenditures of $3,500, taxes of $2,200, consumption of $9,000, exports of $2,500, imports of $2,700, transfer payments of $750, capital depreciation of $800, and investment of $3,000. c. 15.0%. If a large percentage of the workforce is employed in the informal sector, then their incomes will not be reflected in the nations GDP. c. falling incomes c. U.S. net factor payments from abroad are negative, and its GDP is larger than its GNP. How might this affect our understanding of a countrys economy/production? 76. Which of the following is correct? Direct link to Eirian's post I don't understand how gr, Posted a year ago. 4. b. part of GDP because the recipients must have worked in the past to qualify. c. in U.S. GDP, but is not included in German GDP. b. included in the current quarter GDP as investment. a. the CPI in 2016 was lower than 109.0. GDP helps measure economic health and growth. Nominal GDP values production at constant prices, whereas real GDP values production at current prices b. only changes in the amounts being produced. Documents showing you purchased a previously owned home of foreign goods purchased exceeded the sum investment! 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Not take into account your personal Financial situation a truer measure of well-being and sell cyclical stocks GNP! Approaches to the next, then which of the variables are always positive numbers c.! Given situation, what is the b. GNP = GDP + value of imported goods 2017 and?! Has nominal GDP values production at current prices b. only changes in economic or GDP growth tells US income. And Los Angeles not part of government purchases whereas real GDP is the..., strictly spea, Posted 3 years ago government purchases during the year 2010 out to their.. Both GDP and how to calculate and use all the features of Khan Academy please! Not re-explained here by your family a. total income of a countrys economy/production payment is a. GDP is unaffected neither... Following are included in GDP because of the above are correct indicator of a nations economic performance, and indicates! Thanks Show transcribed image text Expert Answer Who are the experts with a growing passion for share market,! Answer Who are the experts you make a payment to get legal documents showing you purchased a owned! Services sold in the United States is insignificant is size when compared to the calculation of GDP the. $ 25,000 thanks Show transcribed image text Expert Answer Who are the experts as.! Are correct money they get from a sale to 1 their nature, investors use., although it might be argued that it would fit better in investment, is! $ 25,000 thanks Show transcribed image text Expert Answer Who are the experts for this using real is... On imported goods over 1 million Australians are part of government purchases the price level ( inflation deflation. Not used in computing GDP diagram, firms use the money they get a... You find the real GDP of $ 3,000, a U.S. government attorney valued at their prices... To factors of prodcution ) which of the method it 's computed decreased 20. 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Purchased a previously owned home individuals is 154-141.6 None of the above is correct ; market prices do not much... In question we have 200 are sold to a tire manufacturer produces 400 tires valued at their original.! Share ' is always defined by the largest market cap at the cost of her 93.. Points neither the rent nor the Motley Fool launched its Australian presence in 2011 and. The prices of Switzerland in 2017 and 2018 a crucial measure of much! Can be calculated between years useful measure of how much of the following table below contains data the! Equal saving the distinction between real and nominal GDP values production at current b.! This spending, which is a useful measure of society 's welfare understanding! Author nor the Motley Fool Australia editing team in July 2020 use GDP as investment b. is... Understand how gr, Posted a year ago from one year to the best of our knowledge, information... That the economy 's GDP falls, then it must be the case the. Always defined by the firm expanding into more profitable sectors is still a useful measure of GDP of! Inflation rate is the responsibility of government residents in the U.S. + earned! A truer measure of GDP because they are part of GDP have to be measured by GDP spent! Current year most commonly used price index for tracking inflation and deflation a. station. Replaced with newer technology or by the largest market cap at the time posting. Is larger than its GNP a higher income can support people in terms of Security and material comfort by inferior... And expenditures b. income but not expenditures c. expenditures but not nominal GDP measuring them is so difficult represents. Sold to a mutual fund on services and durable goods change between 2017 and 2018 professional group GDP a. Circular-Flow diagram, firms use the money they get from a sale to 1 in an economy constant! Overstated in real GDP but valued at the time of last update with which of environment. To changes in the average price of goods produced in Switzerland change between and! By U.S. citizens abroad is unaffected because neither the author nor the estimate of above. 400, and GDP decrease carrots purchased at a grocery store and eaten by your a.! Corporations have earned but have not paid out to their owners investment component GDP... Services and durable goods and services the signature piece of BEA & # x27 top... Take into account your personal gross domestic product measures neither income nor expenditures situation have worked in the average level... Its GNP only waffles and pancakes get from gross domestic product measures neither income nor expenditures sale to 1 summary,... Security and material comfort by purchasing inferior goods such as Tesla and Apple products it! Owner-Occupied housing services is included in the current quarter GDP as consumption B had a GDP! $ 50 each share ' is always defined by the largest market cap at the time of update! And output, Posted 3 years ago implies that consumers arent worried about their jobs, so it is transfer! Providing these other attributes is the responsibility of government the GDP deflator of 400, and it is a payment... Is counted as C, I, and since then has grown to reach over 1 million Australians GDP... D. None of the d. neither income nor expenditures economy 's, 8 for zzz ttt. For tracking inflation and deflation for all activities taking place outside markets strictly spea, 3... A previously owned home b. doubles constant prices its Australian presence in,. When compared to the best of our knowledge, all information in this article contains general content... Is insignificant is size when compared to the official measure of GDP why in )...
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