Which of the following describes the informal economy?
A) It is largely unmeasured.
B) It does not include transactions dealing with illegal goods and services.
C) It does not include income earned by undocumented residents.
D) It is around 20% of U.S.GDP.

Question

Quizplus · Accepted Answer

The informal economy is largely unmeasured as it consists of economic activities that are not recorded in official statistics.

Answer: B
 The informal economy includes illegal activities such as drug trafficking, prostitution and gambling.

Answer: C
 The informal economy includes income earned by undocumented residents who are not authorized to work in the formal economy.

Answer: D
 The size of the informal economy varies by country and is difficult to measure, but estimates suggest that in the United States it is around 10-12% of GDP, not 20%.

Which of the Following Describes the Informal Economy