Jake, Sr Sells the Family Business, a Factory That Produces Snake

question 129

Multiple Choice

Jake, Sr. sells the family business, a factory that produces snake oil, to Jake, Jr., for $100, even though the factory has been assessed at $400,000. How will this transaction affect GDP?

• A) Investment will increase by $100.
• B) Investment will increase by $400,000.
• C) Consumption will increase by $400,000.
• D) GDP will not be affected by the transaction.

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