Which of the Following Transactions Adds to U

question 115

Multiple Choice

Which of the following transactions adds to U.S. GDP for 2010?

• A)In 2010, Ashley sells a car that she bought in 2006 to William for $5,000.
• B)An American management consultant works in Mexico during the summer of 2010 and earns the equivalent of $30,000 during that time.
• C)When John and Jennifer were both single, they lived in separate apartments and each paid $750 in rent. John and Jennifer got married in 2010 and they bought a previously unoccupied house that, according to reliable estimates, could be rented for $1,600 per month.
• D)None of the above transactions adds to U.S. GDP for 2010.

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Definitions:

Comparable Companies

A valuation method that involves comparing a company's financial metrics to those of similar companies in the same industry.

Operating Strategies

Plans and actions implemented by a business to support its operational objectives and to enhance competitive advantage.

Property, Plant, And Equipment

Tangible long-term assets used in the operation of a business, such as buildings and machinery, not intended for resale.

Component Percentages

Financial analysis technique that represents each financial statement item as a percentage of a base figure for easier comparison.