gdpI know the standard definition: final goods are those goods are consumed rather than used to produce other goods. But how can we know if some goods will be consumed or used in production?
For example, a flour factory produced 1000 bags of flour this year, but it sold only 900 bags of them. Now it has to store the left 100 bags.
If we count them as inventory(i.e. the final goods which factory sells to itself), but in the next year a bread factory use them to make breads and then sell to householder, do we double count their value?
In the other hand, if we don’t count them into GDP, as how we treat other intermediate goods, do we underestimate the GDP because we don’t count all of the goods produced in the country?
That’s why you really want to focus on added value.
The GDP the second year should change by the cost of the bread just made minus the price of the 100 bags of flour used to make it.
You are counting only the value added by the bread.
A final good or consumption good is something that is consumed for the sake of consuming it.
A capital good is something that produced purely for the production of some other good; either another capital good, or a consumption good. I.E. and intermediate good.
A printer can be both a capital good and a consumption good. If it is purchased by a business to print invoices, then it is a capital good. If it is purchased by a student to print news articles to read on the plane, then it is a consumption good.
So I believe your question is, “are printers counted in GDP?”. I think the answer is they make some guess about how many printers should be counted as a consumption good and added to GDP. GDP is basically a guess. It is never an exact number.
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