1. GDP does not include the value of used goods that are resold. It does include

Question

1. GDP does not include the value of used goods that are resold. It does include the income earned by the business that sells the used goods since they are providing a new serivce. T/F

2. We can use the GDP deflator to calculate the inflation rate in the economy. T/F

3. GDP increased from $16.22 trillion to $17.24 trillion. What has the growth rate of GDP?

4. In the economy, income earned when producing new final goods and servides must equal expenditure on the new final goods and services. T/F

5. The value of GDP in any given year measures the dollar value of new, final goods and servies sold during the given time period. T/F

6. Capital goods are goods that will be used in the future to produce more goods and services. T/F

7. When Honda produces cars in the United States this does not count in GDP because Honda is not an American company. T/F

Explanation / Answer

1) True

2)true

3)growth rate=17.24-16.22/16.22*100=6.28%

4)false because net indirect tax and subsidy is the difference

5)false It's the value of final goods and services produced, not sold.

6)True

7)False, it will be a part of US GDP

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