A Car That Is Produced in 2013 Is Not Sold

question 215

Multiple Choice

A car that is produced in 2013 is not sold until 2014.According to the definition of GDP,in which year's GDP should it be counted?

• A)2013
• B)2014
• C)Half of the sales price will count as part of 2013 GDP and half will count as part of 2014 GDP.
• D)The production cost will count as part of 2013 GDP while the sales price will count as part of 2014 GDP.

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Definitions:

Limit Pricing

A strategy where a firm sets its product prices low enough to deter new competitors from entering the market.

Price Leader

A company or product that has a large enough market share to influence the price levels of its products or services in the industry.

Entry of New Firms

The process by which new companies enter an industry, often leading to increased competition and impacts on market prices and incumbent firms.

Oligopolistic Firms

Companies that operate in a market structure characterized by a small number of dominant firms, often leading to limited competition.