Consider the following statements about GDP 1 It includes economic activity by the nationals o...........

Economic Affairs Growth and Indicators

Consider the following statements about GDP:

1) It includes economic activity by the nationals of a country present anywhere.

2) GDP includes both goods and services.

3) Intermediate goods that are used to produce other final goods are included in GDP.

Mark the incorrect statement(s)

1 and 2

1 and 3

1,2 and 3

None of the above

Both statements 1&3 are incorrect.

GDP is the monetary value of all the goods and services produced in a country in one financial year. It includes domestic economic activities within the boundaries of country. Indian Nationals can work anywhere and they will add up to the gdp of that particular country.
GDP is composed of goods and services produced for sale in the market and also includes some nonmarket production, such as defense or education services provided by the government. An alternative concept, gross national product, or GNP, counts all the output of the residents of a country.
Intermediate goods are not included in the calculation of a country's GDP. The reason for not including them in the GDP is because it will lead to counting the value of the goods twice, and the norm is to count the price of final goods only once.