Please explain, thanks! (sorry for the small text-see transcribed text if it is
ID: 1146534 • Letter: P
Question
Please explain, thanks! (sorry for the small text-see transcribed text if it is too small)
Suppose that you are planning to buy a new cellphone. Your choice is a new Samsung phone or HTC model. Samsung phones are manufactured in Korea and HTC phones are manufactured in Taiwan Assuming that the price of each phone is the same, will your purchase of the Samsung or the HTC affect U.S. GDP differently? a. No, both have the same impact: your purchase will increase consumption expenditures and decrease net exports by the same amount. b. Yes. This depends upon which cellphone carrier you choose. c. No, because Samsung's production only affects Korea's GDP; and HTC's production only impacts Taiwan's GDP. d. Yes. The country from which a product is imported has different effects on U.S. GDP because it depends upon trade agreements with the countries.Explanation / Answer
option (A)
No, both have the same impact: your purchase will increase consumption expenditures and decrease net exports by the same amount.
because these products are imported from other countries and consumed in domestic territory.