Question

Based on this definition, indicate which of the following transactions will be included in (that is, directly increase) the GDP of the United States in 2017.
a. Calculo, a U.S. electronics company, produces a calculator at a plant in Indonesia on March 17, 2017. Calculo imports the calculator into the United States on May 21, 2017.
b. Fastlane, a Japanese automobile company, produces a sedan at a plant in Indiana on December 12, 2027. A family buys the sedan on December 24.
c. Awake Cafe, a U.S. coffee company, produces a latte at its location in Minneapolis on January g, 2017. It sells the latte to a customer immediately.
d. Graincorp, a U.S. agricultural company, produces corn syrup at a plant in Iowa on September 19, 2017. It sells the corn syrup to Crunchy's for use in the production of cereal that will be made in the United States in 2017. (Note: Focus exclusively on whether production of the corn syrup increases GDP directly, and ignore the effect of production of the cereal on GDP.)
e. You chop down a cherry tree on your property in California and make a dining room table in 2017. A similar table sells for $800 in a local furniture store.

Answer 1

Answer:

B

C

Explanation:

Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year

GDP calculated using the expenditure approach = Consumption spending by households + Investment spending by businesses + Government spending + Net export

Net export = exports – imports  

Items not included in the calculation off GDP includes:  

1. services rendered to oneself

2. Activities not reported to the government  

3. illegal activities

4. sale or purchase of used products

5. sale or purchase of intermediate products

Only goods produced in a country would be included in the GDP. for this reason, the calculator would not be included in GDP