ECONOMICS
GDP
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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If a farmer buys a new tractor, it would be an example
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Consumer good
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Business investment
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Government spending
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(X-M)
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Explanation:
Detailed explanation-1: -Answer. It is an example of fixed capital as tractor can be used again after a use.
Detailed explanation-2: -Purchase of a tractor by a farmer will be included in the estimation of National Income because it is part of gross domestic capital formation.
Detailed explanation-3: -Purchase of tractor has not been added because it is element of intermediate consumption. Its value had been already included in the value of sale of wheat by farmer in local market.
Detailed explanation-4: -Answer: It is an intermediate product because it is further used in the process of production .
There is 1 question to complete.