Double Counting Can Be Avoided By

question 90

Multiple Choice

Double counting can be avoided by:

• A) deducting a double-counting factor from the GNP estimates.
• B) adding the value of only the intermediate (non-?nal) goods and services produced.
• C) adding the incremental value added at each stage of production.
• D) including the value of all output produced in the economy.

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Definitions:

Producer Surplus

The difference between what producers are willing to accept for a good versus what they actually receive, typically viewed as a measure of producer welfare.

Consumer Surplus

The divergence between the sum consumers are prepared to pay for a product or service and the sum that is actually paid.

Maximum Price

A price ceiling set by a government or regulatory body, above which a particular good or service cannot be sold, often to protect consumers.

Equilibrium Prices

The price at which the quantity of a good supplied is equal to the quantity demanded, leading to market balance.