Question

explsin the concept of double counting and also give reason that whether final goods should be included in national income or intermediate goods?

Answer 1

double counting it means that if the value of the intermediate goods is counting in the GDP of the country of that thir and when this intermediate good is converted into the final good then the value of final God has also counted in the GDP of the country in the current year then this will result in the double counting of the value of one good only to avoid this is a value of only final goods are calculated and is a value of intermediate goods are not calculated as they are used for the production of the final goods