Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and beginning April 20th, 2021 (Eastern Time) the Yahoo Answers website will be in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.
Trending News
Econ question about the GDP?
Me and my friend are stuck.
Suppose the total market value of all final goods and services produced in a particular country in 2006 is
$500 billion and the total market value of final goods and services sold is $450 billion. We can conclude that:
A. GDP in 2006 is $450 billion.
B. NDP in 2006 is $450 billion.
C. GDP in 2006 is $500 billion.
D. inventories in 2006 fell by $50 billion
I think its D, but my friend says its A.
which one is it, a good explanation would be appreciated.
1 Answer
- sensekonomikxLv 71 decade agoFavorite Answer
Neither you nor your friend are right. The correct answer is C. GDP in 2006 is $500 billion.
Your friend is wrong because gross value added takes place once production has taken place and one does not have to wait till sales takes place. Because sales during a year can be out of the unsold stocks carried over from the previous year.. You are right in thinking that your friend is wrong and guessing that this has something to with the inventories. But if the market value os sales is less than the market value of production ( both in terms of aggregate of all final goods and services), inventories should go up, and not down as D states, by $50 billion.
