5. 21 points For each of the following transactions, determine the contribution

Question

5. 21 points For each of the following transactions, determine the contribution to the current year's GDP. Explain the effects on the product, income, and expenditure accounts. (a) On January 1, you purchase 10 gallons of gasoline at $2.80 per gallon. The gas station purchased the gasoline the previous week at a wholesale price (incuding transportation costs) of S2.60 per gallon. (b) A historical mansion is purchased for $1,000,000. The broker fee is 6%. (c) A stay-at-home dad enters the work force, taking a job paying $40,000 annually. He pays S16,000 for professional child care services (d) A foreign company builds an auto plant in Detroit for S100 million, using only local labor and materials (e) You win $3 million the lottery, paid immediately. (f) The lottery agency pays you an additional S5K to appear in a TV commercial (g) A retail firms replaces its rental car fleet. It buys $100M from an automaker, sells the old fleet for $40M to a consortium, which is in turn sold to the public for S60M.

Explanation / Answer

A =10(2.8)=28 addition to gdp. Final price is used to calculate gdp

B nil as it was produced previously

C, 40000 will be included. Child care of 16000 will also be included since they are transacted

D Yes it is Fdi.full amount will be included

Can answer only 4 parts according to chegg policy

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