The Local Chevrolet Dealership Has an Increase in Inventory of 25

question 41

Multiple Choice

The local Chevrolet dealership has an increase in inventory of 25 cars in 2006.In 2007 it sells all 25 cars.Which of the following statements is correct?

• A)The full value of the increased inventory will be counted as part of GDP in 2006, and the value of the cars sold in 2007 will not cause 2007 GDP to increase.
• B)The value of the increased inventory will not affect 2006 GDP; instead, the full value of the inventory will be counted as part of 2007 GDP.
• C)The value of the increased inventory will be counted as part of 2006 GDP and the value of the cars sold in 2007 will increase 2007 GDP.
• D)One-half of the value of the increased inventory will be counted as part of 2006 GDP and the other one-half of the value will be counted as part of 2007 GDP.

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Definitions:

Contract Rate

The agreed-upon interest rate specified in a contract, often related to loans or financial agreements.

Market Rate

The prevailing rate of interest available on investments or the average cost of borrowing money in the market.

Issued

The process of making securities available for sale to the public or the amount of a product or securities distributed to the public.

Contract Rate

The agreed-upon interest rate specified within a contract, particularly in lending agreements.