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WAEC Economics 2016 Question 32

Question 32

National Income

In national income accounting, double counting occurs when

  1. A.intermediate goods are counted twice.
  2. B.intermediate goods are counted with the final goods.
  3. C.final goods are counted more than once.
  4. D.different people count the products.
Show the answer and explanation

Answer: B (intermediate goods are counted with the final goods.)

Explanation

Counting intermediate goods as well as the final goods that contain them counts their value twice.