Question Details

The difference between gross investment and net investment is



1) Which of the following purchases is included in personal consumption expenditures when
determining gross domestic product?
A) purchase of a new house because of the arrival of a new baby
B) purchase of a new office building
C) vacation expenses for a spring trip to Fort Lauderdale
D) purchases of jeans to add to a storeʹs inventory
2) Personal consumption expenditures include all of the following EXCEPT spending on
A) consumer durable goods.
B) consumer nondurable goods.
C) consumer services.
D) new housing.
3) All of the following household expenditures are included in consumption expenditure EXCEPT
A) payment to a dentist for filling a tooth.
B) purchase of corporate stock.
C) purchase of a new purse.
D) purchase of hair styling.
4) Gross private domestic investment is all purchases of newly produced business capital goods
and buildings
A) minus the change in business inventories.
B) plus the change in business inventories plus residential construction.
C) plus fixed investment minus inventory investment.
D) plus purchases of capital goods produced in previous years to replace any depreciated
capital goods.

5) The difference between gross investment and net investment is
A) inflation.
B) depreciation.
C) initial capital.
D) consumption.



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