Which of the following statements about GDP is correct?

The statement about GDP that is correct is that GDP includes only domestic production. Gross Domestic Product (GDP) measures the total value of all goods and services produced within a country's borders during a specific time period, regardless of the nationality of the producers. This definition means that only the economic activity occurring within the geographical boundaries of the country contributes to its GDP.

The other statements present misconceptions regarding GDP. Transfer payments, such as social security or unemployment benefits, are not included in the calculation of GDP because they are not payments for goods or services produced. While GDP and Gross National Product (GNP) are related concepts, they are not the same; GNP includes the value of goods and services produced by a country's residents regardless of where that production occurs, while GDP focuses strictly on domestic production. Lastly, GDP does not account for the production of U.S. citizens overseas, as it only reflects the economic activities that take place within the country itself.