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Per NCERT's example, a farmer sells wheat to a flour mill for Rs 20/kg, mill sells flour for Rs 25/kg, biscuit company sells biscuits for Rs 80. What VALUE counts towards GDP?
ARs 20 (raw input only)
BRs 20 + Rs 25 + Rs 80 = Rs 125 (sum all)
COnly Rs 80 (the final good — biscuits — already includes the value of intermediate wheat and flour)
DRs 25 (middle product only)
Answer & Solution
Correct answer: C. Only Rs 80 (the final good — biscuits — already includes the value of intermediate wheat and flour)
Per NCERT example, only the final good (Rs 80) is counted to avoid double-counting. The other options would inflate GDP.
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