The value-added approach of calculating GDP:
A) is an alternative, and equally valid, way of avoiding the problem of double-counting.
B) lets us break down the total value paid and see how much of it was created at each step of the production process.
C) is especially useful when thinking about services involved in the resale of existing goods.
D) All of these are correct.

Question

Quizplus · Accepted Answer

The value-added approach is an alternative and equally valid way of avoiding the problem of double-counting. It lets us break down the total value paid and see how much of it was created at each step of the production process. This approach is especially useful when thinking about services involved in the resale of existing goods. Therefore, all of these choices are correct.

The Value-Added Approach of Calculating GDP