GROSS DOMESTIC PRODUCT

WHAT IS INCLUDED AND EXCLUDED IN GDP? 

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Included:

• C- consumption
• IG- gross private domestic investment. factor equipment, maintenance, construction of housing, unsold inventory, or products built in a year. (net investment+depreciation) 
• G- government purchases
• XN- net exports (exports-imports)  

Excluded:

•  intermediate goods- goods used to make final goods (avoid double/multiple counting)
• used/secondhand goods- (avoid double/multiple counting)
• stocks & bonds- purely financial, (no production)
• unreported business activity
• gifts and transfer payments- private and public
• illegal activities
• non market activities