Related to the Economics in Practice on P

question 181

Multiple Choice

Related to the Economics in Practice on p. 107: If a Harley Davidson dealer in Chicago sells a newly manufactured Harley motorcycle on eBay to a customer in Tokyo, Japan, the value of the motorcycle is

• A) counted in U.S. GDP.
• B) counted in Japanese GDP.
• C) counted in U.S. GDP and Japanese GNP.
• D) not counted in U.S. GDP because it was sold to a foreign customer.

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Definitions:

Transaction Costs

Transaction costs are expenses incurred when buying or selling goods or services, including the costs of searching for information, negotiations, and enforcement of contracts.

Spread

The difference between two values, such as the bid and ask prices in financial markets, or the range in statistical data.

Market Maker

An entity that buys and sells securities from their own inventory, facilitating trading and liquidity in the market.

Transactions

The act of conducting business or commercial dealings, such as buying, selling, or exchanging goods, services, or financial instruments.