Social Sciences and History / Unit 14 SSH 1308 short lesson, about 20 seconds
Double Counting and Intermediate Goods
Captions available
The idea
To avoid double counting, GDP counts only final output, not intermediate goods. An intermediate good is output provided to other businesses at an intermediate stage; a final good is used directly for consumption, investment, government or trade.
In practice
Count the bread, not the flour and the bread.
Where people slip
Whether a good is final depends on its buyer.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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