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aniked [119]
3 years ago
5

Amy has a card shop. She receives a shipment of Valentine's Day cards in December 2011 made by a card manufacture in that month.

Amy pays the wholesale distributor of the cards a total of $500. In February 2012, she sold all the cards for a total of $800. What are the contributions of these transactions to GDP in 2011 and 2012?
Business
1 answer:
Firdavs [7]3 years ago
6 0

Answer:

The contributions of these transactions is a reduction to GDP by $500 in 2011 and an increase in GDP by $800 in 2012.

Explanation:

GDP is the abbreviation for gross domestic product which is the monetary value of all finished products (goods and services) made within a country during a specific period (usually a year). In the determination of a country's GDP, imports are subtracted while exports or sales are added.

Therefore considering that Amy received a shipment of Valentine's Day cards in December 2011 paying a total of $500 and sold all the cards for a total of $800 in February 2012, the contributions of these transactions is a reduction to GDP by $500 in 2011 and an increase in GDP by $800 in 2012.

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Explanation:

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Complete Question:

1. Select the correct statement regarding relevant costs and revenues.

A. Sunk costs are not relevant for decision-making purposes.

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1. The correct statement regarding relevant costs and revenues is that sunk costs are not relevant for decision-making purposes. Sunk costs are the opposite of relevant costs because they can't be changed or recovered, as they've been spent or contracted in the past already. Hence, relevant cost are relevant for decision-making purposes but not sunk costs.

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3. The benefits sacrificed when one alternative is chosen over another are referred to as opportunity costs. It is also referred to as alternative forgone.

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