Suppose a farmer sells a bushel of wheat to a miller for $1;the miller makes it into flour and sells it to a baker for $2;the baker turns it into bread and sells it to a customer for $3.Calculating GDP the contribution of transactions would be

A) $1.00.
B) $2.00.
C) $3.00.
D) $6.00.

Question

Sarah Polynice · Accepted Answer

Final Answer : C, Explanation :  GDP measures the market value of all final goods and services produced in a country during a given period. In this scenario, the final product is bread, which sells for $3. The intermediate transactions (wheat to flour, flour to bread) are not counted separately in GDP to avoid double counting.

Suppose a farmer sells a bushel of wheat to a miller for $1;the miller makes it into flour and sells it to a baker for $2;the baker turns it into bread and sells it to a customer for $3.Calculating GDP the contribution of transactions would be

A) $1.00.
B) $2.00.
C) $3.00.
D) $6.00.

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Learning Objectives

Related questions

Suppose a farmer sells a bushel of wheat to a miller for $1;the miller makes it into flour and sells it to a baker for $2;the baker turns it into bread and sells it to a customer for $3.Calculating GDP the contribution of transactions would beA) $1.00.B) $2.00.C) $3.00.D) $6.00.

Definitions

Learning Objectives

Learning Objectives

Related questions

Suppose a farmer sells a bushel of wheat to a miller for $1;the miller makes it into flour and sells it to a baker for $2;the baker turns it into bread and sells it to a customer for $3.Calculating GDP the contribution of transactions would be

A) $1.00.
B) $2.00.
C) $3.00.
D) $6.00.