Which of the following is included in the investment component of GDP?

a. Construction of a new commercial warehouse

b. Purchases of initial inventory to stock the shelves of a newly opened bookstore

c. Construction of a private residence

d. All of the above

The correct answer is letter "D": All of the above.

Explanation:

The Gross Domestic Product (GDP) represents the overall market value of all the goods and services a country produces and measures the size of the economy over a certain period. The GDP takes into account government spending, private investments, consumption, and net export (exports minus imports).

Private investment could be non-residential - tools, machinery, and factories - and residential - physical structures and equipment. Thus:

A) Construction of a new commercial warehouse (Residential Investment).

B) Purchases of initial inventory to stock the shelves of a newly opened bookstore (Non-residential investment).

C) Construction of a private residence (Residential Investment).