The Value of Intermediate Goods Is Excluded from the Measurement

question 50

Multiple Choice

The value of intermediate goods is excluded from the measurement of GDP in order to:

• A)adjust for inflation.
• B)avoid double counting.
• C)index economic activity.
• D)measure GDP in constant prices.

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Definitions:

Differentiate Product

The strategy businesses use to make their products or services stand out from competitors, often through unique features or branding.

Larger Profits

An increase in the surplus remaining after total costs are deducted from total revenue, indicating greater financial success for a business.

Variable Costs

Costs that vary with the quantity of output produced.

Average Total Cost

The total cost of production divided by the quantity of output produced, representing the per-unit production cost.