Question

Musashi and Rina Woo live in Swarthmore, PA. Rina's father, Sean, lives in Sweden. For each of the following transactions that occur in their lives, identily whether it is included in the calculation of U.S. GDP as part of consumption (C) investment (), government purchases (G), exports (x), or imports (M). Check all that apply Transaction Rina's father in Sweden orders a bottle of Vermont maple syrup from the producer's website. The state of Pennsylvania repaves highway PA 320, which goes through the center of Swarthmore.OO Musashi buys a bottle of Italian wine Musashi's employer upgrades all of its computer systems using U.s.-made parts Rina gets a new video camera made in the United States

Answer 1

Case I

Wine is ordered from the United States by a person living in a foreign country.

So, it will be termed as exports (X).

Case II

Government is incurring expenditure on infrastructure project.

So, it will be termed as government purchases (G).

Case III

An US resident has bought a wine made in foreign country.

So, it will be termed as imports (M).

Case IV

Up-gradation of computer using domestically produced parts implies capital expenditure.

This is termed as investment (I).

Case V

Person has got new video camera that is domestically produced for personal use.

So, it will be termed as consumption (C).

Following is the complete table -

null