Which of the Following Would Be Directly Counted in GDP

question 7

Multiple Choice

Which of the following would be directly counted in GDP in 2012?

• A) kitchen cabinets purchased from Home Depot in 2012 to be installed in a house built in 1997
• B) kitchen cabinets built in 1887, extracted from the 1887 home, and installed in a brand new country-style home
• C) kitchen cabinets built in 1887, extracted from the 1887 home, and installed in a farm house built in 1950
• D) none of the above

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Definitions:

Capital Lease

A lease agreement that is considered a purchase by the lessee because of its terms, such as a bargain purchase option, which allow for the transfer of ownership over the asset's life.

Residual Value

The estimated value of an asset at the end of its useful life.

Capital Lease

A lease classified by lessees as an asset purchase, indicating that the lessee effectively has control over the asset during the lease term.

Interest Revenue

Income earned from deposit accounts or investments through the interest paid by the borrower to the lender.