The money spent on domestically produced final goods and services:

Question

Quizplus · Accepted Answer

Domestic production of final goods and services is the basic measure of a country's economy, known as gross domestic product (GDP). Therefore, the money spent on domestically produced final goods and services is equal to GDP.

Option B is incorrect because exports minus imports represent net exports, which is just one component of GDP.

Option C is incorrect because the circular-flow model does not subtract the money spent on domestically produced final goods and services.

Option D is incorrect because while the three statements are individually true, they do not collectively provide the best answer to the question asked.

The Money Spent on Domestically Produced Final Goods and Services