The country of Alaine produces 1,000 tons of corn during a year. It is valued at $500 per ton. A lobbyist for the corn industry in Alaine argues that the total value of corn production should be included in the country's GDP for the same year. The lobbyist's claim is based on the assumption that A. Alaine is the only country that produces corn. B. Alaine does not export corn to other countries. C. domestic production is insufficient to meet the domestic demand for corn. D. corn is not used in the production of other goods. E. only a part of the total corn produced every year is consumed in the same year.

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Efrain

8 July, 05:55

The country of Alaine produces 1,000 tons of corn during a year. It is valued at $500 per ton. A lobbyist for the corn industry in Alaine argues that the total value of corn production should be included in the country's GDP for the same year. The lobbyist's claim is based on the assumption that A. Alaine is the only country that produces corn. B. Alaine does not export corn to other countries. C. domestic production is insufficient to meet the domestic demand for corn. D. corn is not used in the production of other goods. E. only a part of the total corn produced every year is consumed in the same year.

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Lam · Answer 1

D. corn is not used in the production of other goods

Explanation:

The lobbyists must be assuming that corn us a consumer product. According to this lobbyist, corn is the final product consumed as it is. In other words, corn does not require further processing; neither is it used to produce other products.

In GDP calculations, only the final products produced in the year under review are considered. Goods still in production (work-in-progress), and good to be used in the production of other goods (capital goods) are not considered in GDP calculation of GDP. Including the work in progress and capital goods will lead to double counting. These goods are likely to be counted again as finished / consumer products.