GDP is used by economists to measure a nation\'s total production, so clearly th
ID: 1133937 • Letter: G
Question
GDP is used by economists to measure a nation's total production, so clearly they don't want the calculation of GDP to miss any significant amounts of production that take place 1. What are some production items that the typical measure of GDP might miss? Why? 2. Should these missed items concern us, and, if so, what should we do about it? 3. Scenario: You have a garden in your backyard/window flower box. Provide examples of when the items you grow should or should not be counted in the GDP calculation? Is it possible to have a situation where both occur (count and not be counted)?Explanation / Answer
1) The typical measureof GDP might miss the economic activities performed under black market, work done by homemakers for which nothing is paid. These are missed because of unavailibilty of data or the measure of compensation in case of unpaid labor.
2)Yes because they lead to underestimation of GDP thus prohibits from making benevolent decesion for the society as a whole whenever income from black market is concerned.
3) If the flowers are used for one's own purpose then it will not be considered as apart of GDP but if the owner sells them in the market then they will be counted in the GDP. No it is not possible to have a situation when it is both counted and not counted.
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