How does the expenditures measure of GDP differ from the production measure?
A) It doesn't. The final value is the same.
B) It is lower, because only purchased items are counted.
C) It is higher due to the higher cost of a final good than of the inputs.
D) It depends on the amount of inventories held at the beginning and end of the year.

Question

Quizplus · Accepted Answer

Both the expenditures approach and the production (or output) approach to measuring GDP aim to calculate the same final value of goods and services produced within a country in a given period. The difference lies in the perspective and method of calculation, not in the final GDP value.

How Does the Expenditures Measure of GDP Differ from the Production