ECONOMICS
GDP
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A used economics textbook from the bookstore
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New harvesting equipment for the farm
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1, 000 shares of stock in a computer firm
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A car produced in a foreign country
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Government bonds issued by a foreign firm
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Detailed explanation-1: -Understanding Gross Domestic Product (GDP) The calculation of a country’s GDP encompasses all private and public consumption, government outlays, investments, additions to private inventories, paid-in construction costs, and the foreign balance of trade. (Exports are added to the value and imports are subtracted).
Detailed explanation-2: -The expenditure approach to calculating gross domestic product (GDP) takes into account the sum of all final goods and services purchased in an economy over a set period of time. That includes all consumer spending, government spending, business investment spending, and net exports.
Detailed explanation-3: -Only newly produced goods-including those that increase inventories-are counted in GDP. Sales of used goods and sales from inventories of goods that were produced in previous years are excluded. Only goods that are produced and sold legally, in addition, are included within our GDP.
Detailed explanation-4: -When using the expenditures approach to calculating GDP the components are consumption, investment, government spending, exports, and imports.