Answer
The total GDP is $3.
Work Step by Step
The wheat is an intermediate good, and the bread is the final good. GDP only includes the value of the final good because the value of the wheat is already included in the final price of the bread.
Principles of Macroeconomics 7th Edition
by Mankiw, N. Gregory
Published by
South-Western College
ISBN 10:
1-28516-591-8
ISBN 13:
978-1-28516-591-2
Chapter 10 - Measuring a Nation's Income - Questions For Review - Page 214: 3
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