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Why may the value of vegetables grown and consumed by a family in its home garden be omitted from GDP?

Answer and explanation

Correct answer: No market transaction was recorded

The governing concept is the measurement boundary of GDP: it primarily records production valued through market transactions or reliable imputed prices. Home-grown vegetables consumed by the same family may create real value, but no sale or recorded market payment occurs, so the output can be missed or estimated imperfectly. Option B is correct; the vegetables are food, not imports or capital goods.

Related tags

Self-ConsumptionNon-Market ProductionGdp LimitationWelfareGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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