2. Activities included (and not included) in the calculation of GDP The gross domestic product (GDP) of the United States is defined as the all in a given period of time. Based on this definition, indicate which of the following transactions will be included in (that is, directly increase) the GDP of the United States in 2020. 2020 GDP Included Excluded Scenario An accountant starts a client's 2020 tax return on April 14, 2021, finishing it just before midnight on April 15, 2021. Treetopplers, a U.S. lumber company, produces wood at a plant in Oregon on September 25, 2020. It sells the wood to Buildit and Partners, a developer, for use in the production of a new house that will be built in the United States in 2020. (Note: Focus exclusively on whether production of the wood increases GDP directly, and ignore the effect of production of the new house on GDP.) Fastlane, a Japanese automobile company, produces a sedan at a plant in Indiana on December 14, 2020. A family buys the sedan on December 24. Athleticus, a U.S. shoe company, produces a pair of sneakers at a plant in Vietnam on March 11, 2020. Athleticus imports the pair of sneakers into the United States on May 29, 2020. Awake Cafe, a U.S. coffee company, produces a latte at its location in Minneapolis on January 6, 2020. It sells the latte to a customer immediately.
2. Activities included (and not included) in the calculation of GDP The gross domestic product (GDP) of the United States is defined as the all in a given period of time. Based on this definition, indicate which of the following transactions will be included in (that is, directly increase) the GDP of the United States in 2020. 2020 GDP Included Excluded Scenario An accountant starts a client's 2020 tax return on April 14, 2021, finishing it just before midnight on April 15, 2021. Treetopplers, a U.S. lumber company, produces wood at a plant in Oregon on September 25, 2020. It sells the wood to Buildit and Partners, a developer, for use in the production of a new house that will be built in the United States in 2020. (Note: Focus exclusively on whether production of the wood increases GDP directly, and ignore the effect of production of the new house on GDP.) Fastlane, a Japanese automobile company, produces a sedan at a plant in Indiana on December 14, 2020. A family buys the sedan on December 24. Athleticus, a U.S. shoe company, produces a pair of sneakers at a plant in Vietnam on March 11, 2020. Athleticus imports the pair of sneakers into the United States on May 29, 2020. Awake Cafe, a U.S. coffee company, produces a latte at its location in Minneapolis on January 6, 2020. It sells the latte to a customer immediately.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:2. Activities included (and not included) in the calculation of GDP
The gross domestic product (GDP) of the United States is defined as the
all
in a given period of time.
Based on this definition, indicate which of the following transactions will be included in (that is, directly increase) the GDP of the United States in
2020.
2020 GDP
Included
Excluded
Scenario
An accountant starts a client's 2020 tax return on April 14, 2021, finishing it just before midnight on April 15, 2021.
Treetopplers, a U.S. lumber company, produces wood at a plant in Oregon on September 25, 2020. It sells the wood to
Buildit and Partners, a developer, for use in the production of a new house that will be built in the United States in 2020.
(Note: Focus exclusively on whether production of the wood increases GDP directly, and ignore the effect of production
of the new house on GDP.)
Fastlane, a Japanese automobile company, produces a sedan at a plant in Indiana on December 14, 2020. A family buys
the sedan on December 24.
Athleticus, a U.S. shoe company, produces a pair of sneakers at a plant in Vietnam on March 11, 2020. Athleticus
imports the pair of sneakers into the United States on May 29, 2020.
Awake Cafe, a U.S. coffee company, produces a latte at its location in Minneapolis on January 6, 2020. It sells the latte
to a customer immediately.
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