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.

Question

Quizplus · Accepted Answer

GDP is the total value of final goods and services produced within a country's borders in a given period of time. In this case, Jim's Nursery produced and sold $1100 worth of flowers, which is a final good. Since Jim used no intermediate inputs, we do not need to subtract any intermediate costs. Therefore, Jim's contribution to GDP is $1100.

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