The value of intermediate items is already included in the value of final goods and services.

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Detailed Solution

The above statement is true.
The value of intermediate items is already included in the value of final goods and services. It will result in double counting if we add the value of intermediary items individually. Consider this example, a farmer sells wheat to a flour mill for 10/kg, and the mill grinds it and sells the flour at 12/kg to a biscuit company. The biscuit company uses flour, sugar, and oil to make four packets of biscuits and sells them to consumers for 60 (@20/packet). The biscuits are the final goods here, and their value (60) already includes the value of intermediate goods like flour. Therefore, if we calculate the value of flour once more, we will multiply the same thing's value. Wheat comes first, followed by flour, and then biscuits.

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