ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The first important distinction concerning GDP is that it includes all good and services produced in a country, regardless of where the company is headquartered. For instance, the Mercedes cars produced in the United States are counted in the United States’ GDP, even though Mercedes is a German-owned company.

Detailed explanation-2: -Answer and Explanation: Buying a foreign car made abroad does not increase the Gross Domestic Product. The reason for the argument is because GDP entails goods and services produced within a country? s boundaries.

Detailed explanation-3: -Imports, by definition, are not part of gross domestic product. The BEA, however, is not able to discern the import content of goods and services produced in the United States.

Detailed explanation-4: -The four components of gross domestic product are personal consumption, business investment, government spending, and net exports.