The following events occurred in 2018 in the United States. Indicate the dollar

Question

The following events occurred in 2018 in the United States. Indicate the dollar amount (if any) that is       included in gross domestic product for 2018.

            a.         GM purchases new windows for a Corvette from an American firm, PPG,           $

                        for $5,000. The new Corvette is purchased for $80,000                          

            b.         Dante buys a used 2017 Corvette from Faust for $80,000                                     $

            c.         A household rents a house for $24,000 for their residence.                                  $

            d.         A household’s FPL annual electric bill is $2,400                                    $

            e.         A household rents a condo for $2,000 during their two week vacation      $

            f.          FedEx purchases a new $100 million commercial jet from Boeing;          $

                        the value of the jet’s imported components was $20 million

            g.         A Fort Myers resident purchases a new $50,000 Lexus,                          $

                        the Lexus was built in Japan                             

            h.         $50 million sale of U.S. corn to China                                                   $

            i.          A woman gives a $500 Omas fountain pen to her spouse                        $

            j.          Services provided at home by your significant other, the services            $

                        are valued at $200,000 per year

            k.         College student Bud Weiser receives $2,000 from Moe Weiser               $__________

            l.          A student receives a $2,000 scholarship                                                 $__________  

            m.        A retiree receives $2,000 in social security each month                           $__________

Explanation / Answer

a) GM purchases new windows for a Corvette from an American firm, PPG,   for $5,000. The new Corvette is purchased for $80,000   80,000 It is the price of the final good that is included in GDP. b) Dante buys a used 2017 Corvette from Faust for $80,000 0 It is a used good which is not included in GDP. c) A household rents a house for $24,000 for their residence.     24,000 Included in GDP as consumption d) A household’s FPL annual electric bill is $2,400    2400 Included in GDP as consumption e) A household rents a condo for $2,000 during their two week vacation 2000 Included in GDP as consumption f) FedEx purchases a new $100 million commercial jet from Boeing;  the value of the jet’s imported components was $20 million 80 g) A Fort Myers resident purchases a new $50,000 Lexus,   the Lexus was built in Japan 50,000 Imports h) $50 million sale of U.S. corn to China 50 Exports i) A woman gives a $500 Omas fountain pen to her spouse    0 No market value. j) Services provided at home by your significant other, the services are valued at $200,000 per year 0 No market value. k) College student Bud Weiser receives $2,000 from Moe Weiser 0 It is informal between friends l) A student receives a $2,000 scholarship    0 Excluded from GDP as it is a transfer payment. m) A retiree receives $2,000 in social security each month       0 Excluded from GDP as it is a transfer payment.

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