Which of the following expenditures would increase the investment component of U.S. GDP?
A. You purchase 1,000 shares of stock.
B. You purchase a new car.
C. You pay a commission to your stock broker for selling some stocks that you owned.
D. You purchase a new house.
Answer: D
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A federal law is enacted that mainly benefits one political district, but the costs of this legislation will be spread over the entire country. Which of the following terms describes this situation?
a. Logrolling b. Rational ignorance c. Pork-barrel spending d. Political correctness
When we are at full employment, according to the sophisticated quantity theory of money, if M rises,
A. V will decline. B. P will rise by the same percentage. C. PQ will remain the same. D. PQ will rise by the same percentage, but most or all of the increase will be in P.
All of the following lead to more rapid economic growth EXCEPT
A) restricting international trade. B) encouraging higher rates of saving. C) supporting more research and development. D) encouraging higher quality education.
In the long run,
a. higher consumption spending means a larger capital stock and a higher standard of living b. higher investment spending means higher interest rates c. higher investment spending means a larger capital stock and a higher standard of living d. higher interest rates means higher consumption spending e. higher government spending means a larger capital stock and a higher standard of living