Intermediate products and services are not counted in GDP because they
A) reduce economic well-being.
B) are not consumed in the current year.
C) are only sold in input markets.
D) would be double counted and overstate the value of GDP.
E) are part of the underground economy.

Question

Quizplus · Accepted Answer

Intermediate products and services are not counted in GDP because including them would lead to double counting and overstate the value of GDP. Intermediate goods are used in the production process of final goods and services, and their inflated value would be included in the final product's cost. To avoid this, only value-added in each stage of production is counted towards GDP.

Intermediate Products and Services Are Not Counted in GDP Because