Only final goods and services are included in the calculation of GDP:
because only final goods and services have measurable value
to make GDP simpler to determine
because final goods and services are taxed while intermediate goods and services are not
to avoid double counting of actual national output or income
to ensure that income approach yields a result that exceeds the value using the expenditures approach
And your answer?
to avoid double counting of actual national output or income
The correct answer is "to avoid double counting of actual national output or income."
Gross Domestic Product (GDP) is a measure used to determine the economic performance of a country. It represents the total value of all goods and services produced within a country's borders during a specific time period.
Including only final goods and services in the calculation of GDP is important to avoid double counting. Final goods and services are those that are purchased by the end consumer and are ready for use or consumption. Intermediate goods, on the other hand, are used in the production process and are not intended for final consumption.
By including only final goods and services, we ensure that each product is only counted once in the GDP calculation. If we were to include intermediate goods as well, there would be a risk of double counting, as the value of those goods would already be accounted for when the final goods are sold.
Including only final goods and services also helps to accurately measure the true value of national output or income. By focusing on the final goods and services, we capture the value added at each stage of production. This allows us to avoid overestimating the value of production and provides a more accurate reflection of the country's economic performance.
The other options mentioned in the question are not correct explanations for why only final goods and services are included in the calculation of GDP. While final goods and services do have measurable value, including them in GDP calculation alone does not make the process simpler. Taxes on final goods are not the reason for their inclusion, and the relationship between the income approach and the expenditures approach is not relevant to this specific question.