Question

What is meant by problem of double counting? How this problem can be avoided?

Answer 1

A sample counted more than once is known as double counting. There are two ways in which double counting can be avoided. First is the final product approach and the second is the value-added approach.

In the final product approach sometimes double counting is experienced unintentionally.  

The value-added method considers the value of the final products by adding value from each firm in each phase of production.

This is a much accurate method which can be implemented to avoid the problem of double counting.