GDP figures tend to understate the quantity of goods and services available because
A)they ignore most household production
B)many items are counted twice or more in intermediate stages of production
C)more women are entering the labor force
D)firms often add less to inventories than they planned to
E)exports are subtracted from GDP but imports are not added back in

Question

Quizplus · Accepted Answer

GDP figures only measure goods and services produced in the market, ignoring household production such as cooking, cleaning and childcare. This means that the true quantity of goods and services available is actually higher than what GDP figures indicate.

GDP Figures Tend to Understate the Quantity of Goods and Services