Jnu 2011

[deepasna.kalra]

Please help me with this question. According to me the ans should be a. Am I right?

[ViV]

http://discussion-forum.2150183.n2.nabble.com/JNU-2011-Answer-Key-td7563304.html#a7566480

[deepasna.kalra]

Hey! The ans according to me is option a and the given ans is option b. could you please elaborate on your solution

[neha:)]

Hey! Option (b) is correct.
Reason: GDP measures the total value of all final goods and services in an economy. Here, Z is an intermediate good, used for the production of X and Y. Hence, it wont be counted in the GDP.

 Use GDP = Px.Qx +Py.Qy

[deepasna.kalra]

Hey! According to me , the value of z as an intermediate good is being counted twice coz it is used in the production of both x and y so the final value of x also includes it and the final value of y also includes it.. Isn't this double counting the value of z ? And hence we should subtract it once . Please revert.