In the United States, a large fraction of transactions among banks takes place over Fedwire, which is an electronic payments system operated by the Federal Reserve System.6 During 2008, on an average day, 521,000 payments were made over Fedwire, with a total value of $2.7 trillion. The median value of such transactions was $24,000, and the average value was $5.8 million. To put this in context, annual GDP in 2008 was $14.3 trillion, so average total daily transactions over Fedwire were about 19% of total annual GDP. Do these statistics indicate that there might be some large measurement error in the official U.S. national income accounts, or is this entirely consistent with official GDP numbers being accurate measures of aggregate economic activity? Explain, and discuss your answer.
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