How do we count various goods and services? What precautions should be taken while counting goods and
services?
Dear Student,
a. It is not feasible to count every good and services produced in actual numbers.
b. Rather, we calculate value of the final goods and services produced in a year, in each sector.
c. The value of final goods also includes the value of all the intermediate goods that have been used in making the final good.
d.The value of final goods and services produced in each sector in a year provides for total production in that sector.
e. The sum of production in all three sectors thus gives us Gross Domestic Product
f. Final goods are used for calculating GDP, these are goods which are used for direct consumption by the consumers.
The precaution that has to be taken while counting goods and services is that only final value of the goods and services should be counted, as it includes the value of all the intermediate goods that has been used wile producing the final product.
Regards
a. It is not feasible to count every good and services produced in actual numbers.
b. Rather, we calculate value of the final goods and services produced in a year, in each sector.
c. The value of final goods also includes the value of all the intermediate goods that have been used in making the final good.
d.The value of final goods and services produced in each sector in a year provides for total production in that sector.
e. The sum of production in all three sectors thus gives us Gross Domestic Product
f. Final goods are used for calculating GDP, these are goods which are used for direct consumption by the consumers.
The precaution that has to be taken while counting goods and services is that only final value of the goods and services should be counted, as it includes the value of all the intermediate goods that has been used wile producing the final product.
Regards