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Information and IdeasVery hardMain idea of a passage on economic measurement

Information and Ideas practice question

National income figures count what is bought and sold. A meal cooked at home adds nothing; the same meal bought in a restaurant adds its full price. As more of what households once did for themselves is purchased instead, measured income rises even when the amount of work done, and the amount eaten, has not changed at all.

Which choice best states the main idea of the text?

  1. A. Because national income counts only market transactions, it can rise simply because activity moves from the home to the market.Correct
  2. B. Restaurant meals are better than home-cooked ones.
  3. C. National income falls when people eat at home.
  4. D. Households now do more for themselves than before.

Answer: A. Because national income counts only market transactions, it can rise simply because activity moves from the home to the market.

Same work, same food, higher measured income.

Why the other answers are wrong

B. Restaurant meals are better than home-cooked ones.
Quality is not discussed.
C. National income falls when people eat at home.
It does not fall; it simply does not count.
D. Households now do more for themselves than before.
The opposite trend is described.

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