Question

how do we count the various goods an services for calculating GDP?

Answer 1

1) the value of final goods and services is calculated and then added up to know the total production in each sector.

2) only the value of final goods is calculated because the value of final goods includes the value of all intermediategoods that are used in making the finalgoods.for example:-

the value of table (suppose rupees 2000) includes the value of wood (rupees 1000) and polish (rupees 500).so the value ofwood and polish is not counted seperately. Hope this helps! Cheers!!

Answer 2

Gross Domestic Product (GDP)

Explanation:

Gross Domestic Product (GDP) is the total sum of the values of the final goods and services of the primary, secondary and tertiary sector of economy of a country, produced during a year.

The counting of various goods and services for calculating GDP can be explained as below:

Wheat and flour are intermediate goods used for making final products that are consumed like bread and biscuit. So, the value of intermediate products are not considered for GDP. The value of the final products that are consumed, like bread and biscuit, are added up for GDP calculation because the value of the ingredients (salt, sugar, oil, wheat) are already a part of the finished goods and need not be counted as intermediates.