Household Production,such as Baking Bread at Home,is Not Included in GDP

question 130

Multiple Choice

Household production,such as baking bread at home,is not included in GDP because it

• A)has better quality than the bread in the store.
• B)has lower quality than the bread in the store.
• C)does not add anything of value to GDP.
• D)does not involve a market transaction.
• E)is not really production.

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Definitions:

Gross Price Method

An accounting practice where inventory and purchases are recorded at their full cost without deducting trade discounts.

Catalog Price

The listed price of items for sale as published in a catalog, not accounting for any discounts or promotions that might apply.

Credit Terms

Conditions under which credit is extended by a lender to a borrower, including repayment timeline, interest rate, and any other charges.

Manufacturing Company

A business that produces goods through the processing of raw materials into finished products on a large scale.