For Measuring GDP as Spending on Domestically Produced Final Goods

question 17

True/False

For measuring GDP as spending on domestically produced final goods and services, spending on inputs like steel for manufacturing a car is counted in GDP, but spending on a new factory in which the cars are produced is NOT counted in GDP.

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Definitions:

Market Efficiency

A concept where prices in a market fully reflect all available information, leading to an optimal distribution of resources.

Demand Schedule

A demand schedule is a table that shows the quantity of a good or service that consumers are willing and able to purchase at various prices.

Marginal Cost

The cost of producing one additional unit of a good or service.

Markup

The gap between the purchase expense of a good or service and the price at which it's sold, represented as a percentage of the buying price.