Question

Is the value of intermediate goods and services produced during the year included in Gross Domestic Product (GDP)? For example, is aluminum used to produce a new mountain bike included in GDP? (Note that this question does not ask whether aluminum is directly counted in GDP but rather whether the production is included in GDP) O A. No. There is no value added in the production of aluminum. Therefore, production is not included in the value-added method of measuring GDP O B. No. If we include intermediate goods in GDP, we would be counting the value of the good three times: once when the aluminum is produced, once when it is sold to the manufacturer, and again when the mountain bike is sold to the consumer. O C. Yes. The value of both final goods and intermediate goods is included in the calculation of GDP. O D. Yes. The value of the aluminum is not directly counted in GDP, but the production of aluminum is included in the value-added method of measuring GDP.

Answer 1

From the basic definition of GDP, it only includes the final goods and services production within the boundary of a country in a financial year.

it does not include any type of intermediate goods .

If we add intermediate goods then the value will be counted 3 to 4 times which will misinterpret the data of GDP.

Andwer us option B