Question

GDP is equal to:

a. the market value of all final goods and services produced within a country in a given period of time.
b. Y.
c. C+I+G + NX.
d. All of the above are correct.

Answer 1

GDP is equal to the market value of all final goods and services produced within a country in a given period, is also represented by the symbol Y, and can be calculated using the formula C+I+G+NX. Therefore, the correct answer is d. All of the above are correct.

Step-by-step explanation:

Gross Domestic Product (GDP) can be defined in multiple ways, but fundamentally it represents the same concept. The answer to the question about what GDP is equal to includes:

• the market value of all final goods and services produced within a country in a given period,
• the symbol Y which represents GDP in macroeconomic equations, and
• the formula C+I+G+NX, where C is consumption, I is investment, G is government spending, and NX is net exports.

The concept of GDP is straightforward and focuses on the value of a nation's output, which also equates to the total value of a nation's income. To avoid overestimating GDP, statisticians ensure they do not double-count goods at different stages of production, like counting the value of tires on their own and then again when they are included in the price of a new truck.