If a firm does not sell all of the goods that it produces in a given time period,then the goods
A)do not count in GDP ever.
B)do not count in GDP for that time period but always count next period.
C)count positively in GDP as inventory investment.
D)count negatively in GDP as inventory investment.
E)count in GDP the period they are sold to the final user.

Question

Quizplus · Accepted Answer

When a firm does not sell all the goods it produces in a given time period, the unsold goods count positively in GDP as inventory investment. This is because they are considered part of the firm's capital stock and are held in anticipation of future sales. Once the goods are sold to the final user, they will count in GDP for that period.

If a Firm Does Not Sell All of the Goods