Increase in inventories part of gdp

Assignment Help Business Economics

Reference no: EM13735280

Suppose that in 2012, Canada Cars Corporation produced $20 million worth of cars and trucks but was able to sell only $16 million worth. Is the remaining $4 million increase in inventories part of GDP for 2012?

1. Yes, since changes in inventories are part of consumption expenditures.

2. Yes, since they are part of the economy's output in 2012.

3. Yes, since changes in inventories are part of actual investment.

Select one:

a. 1 only

b. 2 only

c. 3 only

d. both 1 and 2

e. both 2 and 3

Reference no: EM13735280

Questions Cloud

What is the present value of the contract : Italian energy concern Eni SpA agreed to annually purchase 2 billion cubic meters of LNG from Nigeria LNG Ltd. for resale to the United States. The gas is to be produced at the Bonny facility in Africa and delivered to the Cameron import terminal in ..

Given the short-run cost curve : Given the short-run (SR) cost curve in the chart above for a firm in a perfectly competitive market, find the firm’s best output level and total profits when the market price is: a) $18, b) $13 c) $5 d) $3.

Mental health care programs : The government wants to make Medicare benefits available to more people, but to achieve this goal, it needs to make cuts in the existing Medicare budget. The two areas where they are considering cuts are non-essential elective surgery and 6-12 month ..

Inaccurate measure of the true level of economic activity : One major reason that GDP is an inaccurate measure of the true level of economic activity is that

Increase in inventories part of gdp : Suppose that in 2012, Canada Cars Corporation produced $20 million worth of cars and trucks but was able to sell only $16 million worth. Is the remaining $4 million increase in inventories part of GDP for 2012?

Exchange rate with the euro rises : Suppose Canada's exchange rate with the euro rises from 1.2 to 1.4. This rise indicates a(n) ________ of the Canadian dollar, which means it takes ________ Canadian dollars to purchase one euro.

Property taxes might be progressive : Which of the following statements suggests that property taxes might be progressive?

Insurance to canadian exporters for accounts receivable : Export Development Canada (EDC) provides insurance to Canadian exporters for their accounts receivable from foreign buyers. If EDC charges an insurance premium that reflects the average level of risk of the exporting firms, it is only the most risky ..

Because of the free-rider problem : Because of the free-rider problem

User Account

All Pages