Question

Which definition is the best one for GDP?

A
The sum of all final goods and services consumed in a country in a given year.
B
The sum of all final goods and services produced in a country in a given year.
C
The sum of all final goods and services produced in a country minus the goods imported.
D
The sum of all final goods and services produced by citizens of a country in a given year.

Answer 1

GDP is the dollar value of all final goods and services produced in a country in a given year, and it is important to avoid double counting. Therefore, the best definition of GDP is the sum of all final goods and services produced in a country in a given year.

Step-by-step explanation:

GDP stands for Gross Domestic Product, and it is defined as the dollar value of all final goods and services produced in a country in a given year. Final goods are goods that are at the end of the production process and are not used as inputs for further production. It is important to avoid double counting in GDP calculations to accurately measure the value of a nation's output. For example, counting the value of tires produced by a manufacturer and then counting the value of a truck that includes those tires would result in double counting. Therefore, the best definition of GDP is the sum of all final goods and services produced in a country in a given year.