When can grain grown by a farmer for self-consumption be included in GDP?
Answer and explanation
Correct answer: When its imputed monetary value is estimated
National accounting aims to include production even when the producer consumes the output personally, provided that its value can be estimated reliably. Grain grown for self-consumption is therefore assigned an imputed value, usually based on a relevant market price, and included as part of domestic production. Option A is correct. Exporting is unnecessary, destruction is irrelevant, and option D ignores the treatment of own-account production.
Frequently asked questions
What is the correct answer to this question?
When its imputed monetary value is estimated
Why is this the correct answer?
National accounting aims to include production even when the producer consumes the output personally, provided that its value can be estimated reliably. Grain grown for self-consumption is therefore assigned an imputed value, usually based on a relevant market price, and included as part of domestic production. Option A is correct. Exporting is unnecessary, destruction is irrelevant, and option D ignores the treatment of own-account production.
Which subject and chapter does this question cover?
This is a Class 11 Economics question. Chapter: National Income and Related Aggregates. Topic: GDP and Welfare.
