Which of the following is an intermediate good and,therefore,excluded from the calculation of GDP?
A) A set of tires sold to a car owner.
B) A loaf of bread purchased by a grocery store.
C) 100 shares of stock in Microsoft.
D) A new home.
E) A pre-owned automobilE.

Question

Quizplus · Accepted Answer

An intermediate good is a product that is used as an input in the production of a final good or service. In this case, the loaf of bread is purchased by a grocery store, which is an intermediate producer, and is used to make sandwiches or sold to customers. Therefore, it is excluded from the calculation of GDP. The other choices are all final goods or assets, which are included in the calculation of GDP.

Which of the Following Is an Intermediate Good And,therefore,excluded from the Calculation