Question

Which of the following is the best summary of GDP? Select one:

a. The total amount of final and intermediate goods produced within a country over a five-year period.
b. The total dollar amount of all transactions that occur in a country in a single year.
c. The total annual value of domestic output of final goods and services measured at market prices.
d. The annual market value of services produced by U.S.-owned companies throughout the world.

Answer 1

Letter B is correct.

Step-by-step explanation:

GDP is the sum of all that is produced, consumed and distributed in the country over a period of one year. This is the main measure for assessing and comparing one economy with others in the world. There are two approaches to measuring GDP, namely: Expenditure Approach and Income Approach. Demand for consumption, exports and imports and government spending is represented by the expenditure approach. The income approach is all income earned from everything that is produced in the economy.