Increase GDP | CFA Level 1 Exam Question | Test Prep

Which of the following would increase GDP?

Prev Question Next Question

Question

Which of the following would increase GDP?

Answers

Explanations

Click on the arrows to vote for the correct answer

A. B. C. D.

C

Since GDP is the total market value of all final goods and services produced domestically during a specific period, the purchase of any good that was produced within the U.S. will positively contribute to the calculation of GDP. Despite the fact that the transaction profits a foreign company, the good was produced within the

U.S. and therefore is counted in GDP.

The hamburger buns do not contribute to GDP because they are an intermediate good. The house is a re-sold item, which would have been counted in GDP when it was produced, therefore is not recounted when sold.