What components of GDP (if any) would each of the following transactions affect? Explain. Remember Y=C (Y-T) + I (R) + G+X-M a. A family buys a new refrigerator. (Consumption expenditure includes durable and nondurable goods)

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Giles

Business

19 January, 08:52

What components of GDP (if any) would each of the following transactions affect? Explain. Remember Y=C (Y-T) + I (R) + G+X-M a. A family buys a new refrigerator. (Consumption expenditure includes durable and nondurable goods)

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Zachariah Fisher · Answer 1

A. The household purchase of a new refrigerator will directly lead to an increase in the consumption component of the Gross Domestic Product (GDP). Therefore, the GDP will increase by the amount of refrigerator purchased