Which Transaction Is Included in a Current Year's GDP as Investment

question 104

Multiple Choice

Which transaction is included in a current year's GDP as investment spending?

• A) ABC company purchased 10,000 shares of IBM stock.
• B) Ronnie bought a new BMW.
• C) Anton purchased his friend's condo.
• D) Maggie bought a play-gym set for her day-care business.

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Definitions:

Net Present Value

A financial metric that calculates the value of a series of cash flows by discounting them to their present value, often used in investment appraisal.

Capital Expenditure Analysis

The process of evaluating and selecting long-term investments that are in line with the firm's goal of wealth maximization.

Production Process

A series of steps and operations involved in the manufacture of goods, from the input of raw materials to the output of finished products.

Cycle Times

The period required to complete one cycle of an operation from start to finish, often used as a measure of efficiency in processes and production.