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Which transactions will not be counted in GDP? A. Pirated DVDs entering the nation illegally B....

Question:

Which transactions will not be counted in GDP?

A. Pirated DVDs entering the nation illegally

B. The services of a physician

C. A retiree's social security benefits

D. A and C

E. B and C

Gross Domestic Product

Gross Domestic Product is a measure of a country's total production which includes the market value of all final goods produced in a country in a given year. For example, if a computer was manufactured in the U.S. in 2020, the market value of the computer would be part of U.S's GDP in 2020.

Answer and Explanation:

Answer: D. A and C

The Gross Domestic Product does not include underground economy. In this case, pirated DVDs entering the nation illegally represents and underground economy. In addition, the GDP does not include transfer payments. Transfer payments refer to redistribution of income where no goods and services are exchanged. A retiree's social security benefits is a form of transfer payments.


Learn more about this topic:

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Gross Domestic Product: Definition and Components

from Economics 102: Macroeconomics

Chapter 4 / Lesson 3
63K

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