6. Limitations of GDP Although GDP is a reasonably good measure of a nation\'s o

Question

6. Limitations of GDP Although GDP is a reasonably good measure of a nation's output, it does not necessarily include all transactions and production for that nation. which of the following scenarios are either not accounted for or measured inaccurately by either the income or the expenditure methods of calculating GDP for the United States? Check all that apply. O The loss of enjoyment people incur when scenic land is converted to commercial use O The leisure time enjoyed by households O Federal government paychecks to soldiers O The value produced when you wash your own car at home When a U.S. company purchases and imports electronic parts from China to use to produce MP3 players within the United States, this purchase increases the component of GDP while also net exports by the same amount. Therefore, the purchase of electronic parts from China causes in US GDP.

Explanation / Answer

i) ii) iii) can be checked as they are not included in NI calculation.

All the abstract changes and the natural processes are not included in national income calculation.

washing one's own car is also not included as its self work

leisure are also not accounted

however, payment made to central employee are always included.

The fillers are

i)purchase increases import component of gdp. ( import)   

ii) hence net export decreases (decreases)

iii) decrease in us gdp (decrease)  

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