GDP Tends to Underestimate the Productive Activity in the Economy

question 180

Multiple Choice

GDP tends to underestimate the productive activity in the economy because it excludes:

• A)spending by the government on military goods.
• B)spending by businesses to reduce the level of pollution.
• C)the work done by construction companies to remodel homes.
• D)the personal labour time homeowners spend on home repairs.

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Definitions:

Official Court Form

A standardized document issued by the court system or jurisdiction to be used in legal proceedings.

Itinerant Seller

A seller who moves from place to place to sell goods or services, often without a fixed retail location.

Fixed Place of Business

A specific location where a company conducts its operations and business activities on a regular basis.

Legislation

Laws that have been enacted by a legislative body, such as a parliament or congress.