Jim's Nursery produces and sells $1100 worth of flowers.Jim uses no intermediate inputs.He pays his workers $700 in wages,pays $100 in taxes and pays $200 in interest on a loan.Jim's contribution to GDP is
A) $900.
B) $1000.
C) $1100.
D) $1800.
E) $2000.

Question

Quizplus · Accepted Answer

Jim's contribution to GDP is equal to the value of his final goods and services, which is $1100 in this case. The wages paid to his workers, taxes paid and interest paid on a loan are not included in GDP as they are not the final goods and services produced by Jim.

Jim's Nursery Produces and Sells $1100 Worth of Flowers