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23 October, 07:17

An American soldier stationed in North Carolina receives a paycheck from the federal government for $300, which she uses to purchase a $100 MP3 player made in China by a Chinese firm and $200 for fruit and vegetables from a local farmers market. As a result, U. S. GDP increases by?

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  1. 23 October, 10:34
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    The U. S. GDP increases by $200.

    Step-by-step explanation:

    Gross domestic product or GDP is the value of finished goods and services made within a country in terms of money.

    Here as given that the American soldier living in US purchased a $100 MP3 player made in China by a Chinese firm, this will not increase the GDP as the firm is Chinese.

    But when he purchased fruits from a local farmers market, then he is contributing to the GDP of US.

    Hence, U. S. GDP increases by $200.
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