Question

This question tests your knowledge of what activities are included in calculating GDP. Decide for each item whether it is part of GDP and, if so, to which expenditure category it belongs.Purchase of 100 shares of General Motors stock:A. Not counted in GDPB. Counted as part of consumptionC. Counted as part of investmentD. Counted as part of governmentE. Counted as part of net exports

Answer 1

Answer:

Not counted in GDP

Explanation:

GDP is the sum of all final goods and services produced in an economy within a given period which is usually a year.

The components of GDP are :

1. Consumption spending - it is spending by households on final goods and services.

2. Investment spending- the purchase of inventories by businesses

3. Government Spending: the total amount of money spent by the government

4. Net Export - export less import.

GDP measures total output produced and stock isn't an output so it isn't added in the calculation of GDP.

I hope my answer helps you