Which of the following is excluded in the calculation of Gross
Domestic Product (GDP)
for the U.K.?
a) A firm in London making wage payments to a Japanese
citizen.
b) A Canadian bank making wage payments to a U.K. citizen.
c) A dental hospital in London charging treatment fee from a
Chinese citizen.
d) All of the above.
Explain your answer.
The value of goods or services produced within a domestic territory of a Nation is included in GDP calculation of that nation. It doesn't matter whether it is produced by citizen of that country or by a foreigner.
If production occurs within domestic territory of a Nation, then only it will included in GDP calculation.
Note: if goods or services produced by a citizen of a UK outside the domestic boundary of UK (or in foreign land) then it will be not included in GDP calculation of UK.
The payment to a citizen of UK by a Canadian bank would not a part of GDP calculation.
So, the correct answer is an option (b).
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