If a nation makes substantial net income payments to foreign investors, which of the following is most likely true?

Multiple choice question for Economics Mcqs. Select an option, then review the explanation below.

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Its GDP exceeds its GNP by a significant marginIts economic growth rate is lower than that of the other countryIts economy expands faster compared to the other nationIts GDP is less than its GNPNone of the above

Explanation

When a country sends large net income payments to investors abroad, its Gross Domestic Product (GDP) will be higher than its Gross National Product (GNP). This is because GNP subtracts income paid to foreign investors, reflecting net income from abroad.

Practice related questions from the same subject.

1.According to the World Bank, countries are grouped into four categories based on which of the following criteria?
2.Automatic stabilizers belong to which category of economic policy tools?
3.What is the likely effect of an increase in the money supply?
4.Which economic concept illustrates the inverse connection between inflation and unemployment?
5.Which of the following does not constitute a part of the Gross Domestic Product (GDP)?

If a nation makes substantial net income payments to foreign investors, which of the following is most likely true?

Explanation

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