Which Component of GDP Includes Inventory Changes

question 211

Multiple Choice

Which component of GDP includes inventory changes?

• A) consumption
• B) investment
• C) government spending
• D) Inventory changes are not included in GDP.

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Definitions:

Resale Value

The estimated market value of an asset at the time of its sale, reflecting what a seller may realistically receive.

Incremental Cash Flow

The additional cash flow generated by a company from taking on a new project or making a new investment.

Tax Rate

The ratio of taxation applied to the earnings of a corporation or a person.

Leasing NET Advantage

An analysis to determine if leasing an asset is more economically advantageous than purchasing it outright.