When Computing GDP Using the Production Approach, One Must Count

question 30

True/False

When computing GDP using the production approach, one must count only the value added by each business, as opposed to the total value of output produced by each business, in order to avoid double counting.

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Definitions:

Scale of Production

The size or magnitude of manufacturing operations, which can influence costs, efficiency, and profitability.

Average Costs

The total cost of production divided by the quantity of output produced, indicating the cost of producing each unit.

Exhibits

Displays or presentations, often in museums or galleries, that showcase artifacts or works of art for public viewing.

Economies of Scale

Refer to the cost advantages that enterprises obtain due to their scale of operation, typically resulting in the reduction of cost per unit.