GDP may inaccurately measure the value of aggregate output because it may not properly account for
A)the proper value of purchases and sales of used goods and depreciation of consumer durables.
B)production in the underground economy and the true value of government production.
C)all services produced.
D)the true value of government production and the proper value of purchases and sales of used goods.
E)the depreciation of consumer durables and production in the underground economy.

Question

Quizplus · Accepted Answer

GDP may not accurately measure the value of aggregate output because it does not properly account for production in the underground economy and the true value of government production. The underground economy includes illegal activities and unreported income, which may not be included in GDP calculations. Additionally, government production may not be accurately valued, as it is often not sold in markets and therefore lacks a clear market value.

GDP May Inaccurately Measure the Value of Aggregate Output Because