When a Firm Sells a Product Out of Inventory, GDP

question 33

Multiple Choice

When a firm sells a product out of inventory, GDP:

• A) increases.
• B) decreases.
• C) is not changed.
• D) increases or decreases, depending on the year the product was produced.

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Definitions:

Durable Goods

Products that are intended to last for a significant amount of time, such as appliances, cars, and furniture, as opposed to consumer goods which are consumed quickly.

Nondurable Goods

Products with a limited lifespan, intended for consumption or use over a short period, such as food or paper products.

Tangible Attributes

Physical features or characteristics of a product that can be directly perceived by the senses, such as size, shape, color, or weight.