Feedback Categorize each statements as a component of Gross Domestic Product (GD
ID: 1139046 • Letter: F
Question
Feedback Categorize each statements as a component of Gross Domestic Product (GDP): consumption, investment, government, o exports. If it is not included in GDP, leave it unplaced. Who pays for a personal computer? Households? Firms? Government? Consumption Investment Goverment Net exports ice cream government welfare payments a domestically manufactured business computer a domestically manufactured personal computer cab fare for an exported dollhouse personal usc a public school tcacher's salary 55 cent tacos a tickct to a local sporting event Answer Bank the purchase of company stock babysitting paid for in cash and unreportedExplanation / Answer
Consumption component of Gross Domestic Product includes those final goods and services that are purchased by the households for consumption purpose.
Following items would be included in consumption component -
1. Ice cream
2. Cab fare for personal use
3. 55 cent tacos
4. A ticket to a local sporting event
5. A domestically manufactured personal computer
Investment component of GDP includes purchase of capital goods by businesses for further production.
Following items would be included in the investment component of GDP -
1. A domestically manufactured business computer.
Government component of GDP includes purchase of goods and services by government. It does not include transfer payments.
Following items would be included in the government component -
1. A public school teacher's salary.
Net exports component of GDP includes final goods and services exported by an economy and excludes the final goods and services imported by an economy.
Following item would be included in net exports component -
1. An exported doll house.
Following items would not be included in GDP -
1. Government welfare payments
2. Baby sitting paid for in cash and unreported.
3. The purchase of company stock.
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