Which statement about GDP is true?

Which statement about GDP is true?

• A. It is the value of a country's exports only.
• B. It measures population growth.
• C. It is the income of a country for a year.
• D. It tracks per-capita income.

Answer: (C)

GDP represents the total market value of all final goods and services produced within a country during a specific period, usually one year. This captures the size of the economy by measuring the income generated from producing those goods and services in that year. It includes all production domestically, not just exports, and aligns with the idea of the economy’s total earnings from that year’s activity. It doesn’t measure population growth. Per-capita income, meanwhile, is GDP divided by the population, so GDP alone doesn’t indicate average income per person. So describing GDP as the income of a country for a year best reflects what GDP measures.

GDP represents the total market value of all final goods and services produced within a country during a specific period, usually one year. This captures the size of the economy by measuring the income generated from producing those goods and services in that year. It includes all production domestically, not just exports, and aligns with the idea of the economy’s total earnings from that year’s activity. It doesn’t measure population growth. Per-capita income, meanwhile, is GDP divided by the population, so GDP alone doesn’t indicate average income per person. So describing GDP as the income of a country for a year best reflects what GDP measures.