An Economy Produces Only 1,000,000 Computers Valued at $2,000 Each

question 2

Multiple Choice

An economy produces only 1,000,000 computers valued at $2,000 each. Of these, 200,000 are sold to consumers, 300,000 are sold to businesses, 300,000 are sold to the government, and 100,000 are sold abroad. No computers are imported. At the end of the year, the computer manufacturers hold the unsold computers in inventory. What is the value of GDP?

• A)$0.9 billion
• B)$1.0 billion
• C)$1.8 billion
• D)$2.0 billion

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Definitions:

Capital Intensive

Industries or processes that require large amounts of capital investment in heavy machinery or equipment rather than labor.

Alternative Technologies

Refers to various options available for achieving a similar goal, especially in the context of energy sources, manufacturing processes, or digital solutions.

Labor Costs

The total expense incurred by employers for the wages, benefits, and taxes associated with the workforce.

Capital-Intensive

A production process that requires a higher ratio of capital (machinery, equipment) to labor.