Which of the Following Would Be Included in the Calculation

question 145

Multiple Choice

Which of the following would be included in the calculation of gross domestic product (GDP) ?

• A)The value of a used automobile purchased by Jim
• B)The sale price of a new house purchased by Joe
• C)The receipt of $100 in food stamps by Sandy
• D)The $200 that Kurt spends on the purchase of bonds
• E)The amount of money that Laurie receives as unemployment benefit after losing her job

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Definitions:

Variable Cost

Costs that change in proportion with the level of production or business activity, such as materials and labor directly involved in production.

Activity

Refers to any action or task performed within an organization that consumes resources.

Relevant Range

The range of activity over which a company expects its operating assumptions, such as cost behavior and sales mix, to remain valid, influencing budgeting and financial planning.

Fixed Costs

Costs that do not vary with the level of production or business activity, remaining constant even when output changes.