The Value of Final Sales Tends to Be Less Volatile

question 48

Multiple Choice

The value of final sales tends to be less volatile than GDP because

• A) it excludes residential investment.
• B) it excludes inventory investment.
• C) it excludes nonresidential investment.
• D) it includes allowances for credit purchases of large consumer durables.
• E) all of the above.

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Definitions:

Domestic Price

The price of goods or services within a country's borders, which can be influenced by local supply and demand factors.

Domestic Supply

The total amount of goods and services produced within a country's borders that are available for consumption or export.

Domestic Demand

The total demand for goods and services within a country's borders.

World Price

The international market price of a good or service, affected by global supply and demand.