GDP Excludes Most Items That Are Produced and Sold Illegally

question 91

Multiple Choice

GDP excludes most items that are produced and sold illegally and most items that are produced and consumed at home because

• A)the quality of these items is not high enough to contribute value to GDP.
• B)measuring them is so difficult.
• C)the government wants to discourage the production and consumption of these items.
• D)these items are not reported on income tax forms.

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Definitions:

Controllable Costs

Expenses that management can directly or indirectly control or influence in the short term, such as supplies and advertising.

Direct Expense

Costs that can be directly traced to a specific product, service, or department.

Departmental Contribution

The amount of revenue generated by a specific department minus the direct costs associated with that department.

Standard Deviation

A measure of the dispersion or variability within a set of numeric values, indicating how spread out the values are from the mean.