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Which component of GDP will be affected by each of the following transactions involving Ford Motor Company? If you believe that none of the components of GDP will be affected by the transactions, briefly explain why.
a. You purchase a new Ford Escape Hybrid from a Ford dealer.
b. You purchase a 2011 Ford Escape Hybrid from a friend.
c. Ford purchases door handles for the Escape from an auto parts manufacturer in Indiana.
d. Ford produces 1,000 Escapes in a factory in Missouri and ships them to a car dealer in Shanghai, China.
e. Ford purchases new machine tools to use in its Missoui Escape factory.
f. The state of Missouri builds a new highway to help improve access to the Ford Escape plant.
Which one of the following would be the same total amount on a flexible budget and a static budget if the activity level is different for the two types of budgets?
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