To compute GDP,we

Question

To compute GDP,we

Quizplus · Accepted Answer

GDP is the market value of all final goods and services produced within a country's borders during a given period of time, typically a year. Therefore, to compute GDP, we need to add up the market value of all final goods and services. This includes the value of all goods and services consumed by households, investment goods purchased by firms, government purchases of goods and services, and any net exports of goods and services. Adding up the costs of producing all final goods and services (Option B) would only give us the value of inputs used, and not the final value of the goods and services produced. Option A is incorrect because it only includes wages paid to workers and not the value of goods and services produced. Option D is incorrect because it suggests subtracting the cost of production from market value, which would give us the value added by firms and not the overall GDP.

To Compute GDP,we