In the GDP accounts, production equals which of the following?

• A. the total value of imports minus exports in a country during a given period
• B. the total value of all intermediate goods produced within a country during a given period
• C. the sum of all final goods and services produced within a country during a given period
• D. the sum of all government expenditures in a country during a given period

Answer: (C)

Verified step by step guidance

1. Step 1: Understand the concept of GDP (Gross Domestic Product). GDP measures the total market value of all final goods and services produced within a country during a specific period.
2. Step 2: Recognize that GDP does not include intermediate goods to avoid double counting, since intermediate goods are used to produce final goods.
3. Step 3: Recall that imports are goods produced outside the country, so they are not included in GDP, while exports are goods produced domestically and sold abroad, which are included in GDP.
4. Step 4: Note that government expenditures are a component of GDP but do not alone represent total production; GDP includes consumption, investment, government spending, and net exports.
5. Step 5: Conclude that production in GDP accounts equals the sum of all final goods and services produced within a country during a given period.