How does the value of total sales of all firms in the country for a year compare with GDP?
A) It equals GDP for the year.
B) It is larger than GDP for the year.
C) It is smaller than GDP for the year.
D) It could be larger or smaller than GDP for the year.

Question

Quizplus · Accepted Answer

Total sales of all firms include intermediate goods and services, which are not counted in GDP to avoid double counting. GDP only includes the value of final goods and services, so total sales are typically larger than GDP.

How Does the Value of Total Sales of All Firms