Double Counting in GDP Accounting

question 153

Multiple Choice

Double counting in GDP accounting:

• A) refers to the fact that accountants check their figures twice.
• B) refers to the inclusion of both intermediate goods and final goods in GDP.
• C) is the method of using both income and expenditures in measuring GDP.
• D) is the method of calculating the GDP by including the net incomes received by residents of a nation living abroad.

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Definitions:

Permanent/Temporary

Categories that differentiate between enduring or long-term elements and those expected to last for only a limited period.

Natural Resource Cost

The initial cost of acquiring and preparing natural resources for extraction, not including exploration or development.

Intangible

Assets that lack physical substance but possess value, such as patents, trademarks, and goodwill.

Fair Value

An estimate of the market value of an asset or liability, based on the current price at which an asset could be sold or a liability settled in a fair transaction between willing parties.