Which of the following best defines Gross Domestic Product (GDP)?

• A. The total value of all intermediate goods produced within a country in a given year.
• B. The total income earned by a country's residents, including income from abroad.
• C. The total market value of all final goods and services produced within a country in a given period of time.
• D. The total market value of all goods and services produced by a country's citizens, regardless of location.

Answer: (C)

Verified step by step guidance

1. Step 1: Understand that Gross Domestic Product (GDP) measures the economic output within a country's borders during a specific time period, usually a year or a quarter.
2. Step 2: Recognize that GDP includes only the market value of final goods and services to avoid double counting, which would happen if intermediate goods were included.
3. Step 3: Note that GDP focuses on production within the country, regardless of whether the producers are citizens or foreign entities operating domestically.
4. Step 4: Differentiate GDP from Gross National Product (GNP), which accounts for the total income earned by a country's residents, including income from abroad, unlike GDP which is location-based.
5. Step 5: Conclude that the best definition of GDP is the total market value of all final goods and services produced within a country in a given period of time.