1. Intermediate goods are goods and services, such as raw materials and fuel, that are reprocessed or resold for use in the production of other goods. The reason for this is that GDP measures the value of the final product, and intermediate products are not counted in GDP.
2. Unproductive activities, as well as underground and black market transactions. Such as domestic labor, self-sufficient production, gambling and illegal trade in drugs. The reason for this exclusion is that GDP generally refers to the value generated by market activities, and non-market activities, such as illegal activities, are not counted as part of GDP.
3. Income earned by citizens of their own country who are abroad. The reason for this exclusion is that GDP measures the market value of final goods produced within a country and is a geographical concept.
GDP is the final product of productive activity of all resident units of a country at market prices over a given period of time. GDP has three forms of expression, namely, value form, income form and product form. From the value form, it is the difference between the value of all goods and services produced by all resident units in a certain period of time over the value of all non-fixed-asset goods and services invested in the same period of time, i.e., the sum of the value added of all resident units; from the income form, it is the sum of the initial incomes created by all resident units in a certain period of time and distributed to both resident units and non-resident units; and from the product form, it is the sum of the initial incomes of all resident In terms of product form, it is the value of end-use goods and services produced by all resident units in a given period minus the value of imports of goods and services. In practical accounting, there are three methods of calculating GDP, namely the production method, the income method and the expenditure method. Each of the three methods reflects GDP and its components in different ways, and theoretically the calculations are the same.
First, GDP is measured in terms of final products and services, i.e., the final sale value of final products and services in the period. Generally, products can be categorized into intermediate and final products based on their actual use. The so-called final products are the goods and services produced during a certain period of time for direct consumption or use by people. This part of the product has reached the final stage of production, can no longer be used as raw materials or semi-finished products into the production process of other products and services, such as consumer goods, capital goods, etc., generally sold in the final consumer goods market. Intermediate products are goods and services used for reprocessing or resale for use in the production of other products, such as raw materials, fuels, etc. GDP must be calculated on the basis of the current final product, and intermediate products can not be counted, otherwise it will result in double counting.