When John Buys New Tires for His Car It ________,And

question 113

Multiple Choice

When John buys new tires for his car it ________,and when Ford buys tires to put on new cars it ________.

• A) does not count toward GDP; does not count toward GDP
• B) does not count toward GDP; counts toward investment
• C) counts toward consumption; counts toward investment
• D) counts toward consumption; does not count toward GDP
• E) counts toward investment; counts toward investment

---

Definitions:

Advertising Expense

Costs incurred by a company to promote its products, services, or brand, including media buys, production, and creative services.

Direct Materials

Raw materials that are directly traceable to the manufacturing of a product and are significant in cost.

Sales Commissions

Fees paid to salespeople or brokers for facilitating or closing sales, usually calculated as a percentage of the sales value.

Direct Labor

The wages or costs associated with employees who directly contribute to the manufacture of a product or delivery of a service.