A Bakery Uses Flour to Produce Bread

question 58

Multiple Choice

A bakery uses flour to produce bread.When calculating GDP, we include _______ because when we add the value of the flour to the value of the loaf of bread to calculate GDP, the result is _______.

• A)only the value of the flour used to produce the bread; double counting
• B)both the value of the bread sold in a store and the value of the flour used to produce the bread; the true value of the economy's output
• C)both the value of the bread sold in a store and the value of the flour used to produce the bread; double counting
• D)only the value of the bread sold in a store; double counting
• E)the value of the bread sold in a store, the value of the flour used to produce the bread, and the wage rate paid to the baker; less than the true value of the economy's output