International income accounting, double counting occurs when?

A. intermediate goods are counted twice
B. intermediate goods are counted with the final goods
C. final goods are counted more than twice
D. different people count the products

Correct Answer: Option B

B. intermediate goods are counted with the final goods

Explanation

Double counting is an error caused as a result of the illogical calculation. This term is used in economics to refer to the faulty practice of counting the value of a nation’s goods more than once. Since goods are produced in stages, through specialized channels of production, many intermediate goods are used to produce a final good. If the values of each of these intermediate goods is added together, without subtracting expenditures incurred during the production process, the error of double counting will be committed.