Question

to determine a value for gdp, you would: a. add up the quantities of the final goods and services produced. b. add up the dollar value of the final goods and services produced. c. add up the dollar value of the final goods and services produced minus the dollar value of the intermediate goods and services produced d. add up the dollar value of all goods and services produced. e. add up the quantities of all goods and services produced

Answer 1

To determine GDP, one should add up the dollar value of the final goods and services produced to avoid double counting and accurately represent the nation's output.

Step-by-step explanation:

To determine a value for GDP, you would add up the dollar value of the final goods and services produced. This method ensures that the value of a nation's output is equal to the total value of a nation's income, without the problem of double counting. Double counting occurs when output is counted more than once as it moves through various stages of production. Good examples to understand this are the tires being counted both as a standalone product and as part of the final vehicle price. Thus, for accurate GDP calculation, statisticians only count the value of final goods and services, which are at the furthest stage of production at the end of the year.

In the context of the choices provided: option b. add up the dollar value of the final goods and services produced is correct. Whereas, options a, c, d, and e could result in counting intermediate goods or the quantities of products, which does not provide the correct assessment of GDP.