Why Doesn't GDP Include Intermediate Goods

question 16

Multiple Choice

Why doesn't GDP include intermediate goods?

• A) Intermediate goods are not sold to consumers.
• B) Intermediate goods are never valued at full retail price, leading to an undervaluation of GDP.
• C) The value of intermediate goods is included in the final product, and accounting for the value twice would overestimate GDP.
• D) All of these are reasons why GDP does not include intermediate goods.

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Definitions:

Chapter 7 Bankruptcy

A provision of the bankruptcy code that allows individuals and businesses to discharge or eliminate most of their debts through the liquidation of assets.

Debtor's Property

Assets belonging to a debtor that may be used to pay off creditors.

Preferential Payment

A payment made by an insolvent debtor that gives preferential treatment to one creditor over another.

Voluntary Petition

A legal document filed by an individual or entity declaring their intent to undergo bankruptcy proceedings under their own accord.