Answer: The underground economy are transactions hidden from the government, either because they are illegal or to avoid taxes. Because the underground economy is hidden from the government, it is not included in GDP and so GDP is smaller than it otherwise would be.
Answer: The underground economy are transactions hidden from the government, either because they are illegal or to avoid taxes. Because the underground economy is hidden from the government, it is not included in GDP and so GDP is smaller than it otherwise would be.
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