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AP Macroeconomics Free Response #3

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Sheldon Reynolds

on 5 April 2016

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Transcript of AP Macroeconomics Free Response #3

AP Macroeconomics Free Response 2006 #3
Nick Conoley & Sheldon Reynolds

Part A
Question: Indicate whether each of the following is counted in the United States gross domestic product for the year 2006. Explain each of your answers.

(a) The value of a used textbook sold through an online auction in 2006

Answer: No, Gross Domestic Product does not include intermediate (used) goods
Part B
Question: Indicate whether each of the following is counted in the United States gross domestic product for the year 2006. Explain each of your answers.

(b) Rent paid in 2006 by residents in an apartment building built in 2000

Answer: Yes, rent is considered inventory and inventory is included in the GDP because it is an investment.
The Question
3. Indicate whether each of the following is counted in the United States gross domestic product for the year 2006. Explain each of your answers.
Part D
Question: Indicate whether each of the following is counted in the United States gross domestic product for the year 2006. Explain each of your answers.

(d) The value of automobiles produced in 2006 entirely in South Korea by a firm fully owned by United States citizens

Answer: It is considered an import even though American owned therefore it is subtracted from the GDP.


Part C
Question: Indicate whether each of the following is counted in the United States gross domestic product for the year 2006. Explain each of your answers.

(c) Commissions earned in 2006 by a stockbroker


Answer: No, Stocks are not included and commissions which equal personal income do not count either because it is not consumer spending.
(a) The value of a used textbook sold through an online auction in 2006
(b) Rent paid in 2006 by residents in an apartment building built in 2000
(c) Commissions earned in 2006 by a stockbroker
(d) The value of automobiles produced in 2006 entirely in South Korea by a firm fully owned by United States citizens
Full transcript