Questions: For each of the following transactions that occur in their lives, identify whether it is included in the calculation of U.S. GDP as part of consumption (C), investment (I), government purchases (G), exports (X), or imports (M) : Check all that apply. Transaction The Pennsylvania Department of Transportation, a state administration, repairs a bridge along PA highway 23, which feeds into the center of Conshohocken. Frances gets a new smart bird feeder made in the United States. Frances's father in Mexico orders a Martin guitar, made in Pennsylvania, from the producer's website. Dmitri's employer upgrades all of its computer systems using U.S.-made parts. Dmitri buys a bottle of French champagne.

For each of the following transactions that occur in their lives, identify whether it is included in the calculation of U.S. GDP as part of consumption (C), investment (I), government purchases (G), exports (X), or imports (M) : Check all that apply.

Transaction The Pennsylvania Department of Transportation, a state administration, repairs a bridge along PA highway 23, which feeds into the center of Conshohocken.

Frances gets a new smart bird feeder made in the United States.

Frances's father in Mexico orders a Martin guitar, made in Pennsylvania, from the producer's website.

Dmitri's employer upgrades all of its computer systems using U.S.-made parts.

Dmitri buys a bottle of French champagne.

Transcript text: For each of the following transactions that occur in their lives, identify whether it is included in the calculation of U.S. GDP as part of consumption (C), investment (I), government purchases $(G)$, exports $(X)$, or imports $(M)$ : Check all that apply. \begin{tabular}{|l|l|} \hline Transaction & The Pennsylvania Department of Transportation, a state administration, repairs a bridge along PA highway \\ 23, which feeds into the center of Conshohocken. \\ \hline Frances gets a new smart bird feeder made in the United States. \\ \hline Frances's father in Mexico orders a Martin guitar, made in Pennsylvania, from the producer's website. \\ \hline Dmitri's employer upgrades all of its computer systems using U.S.-made parts. \\ \hline Dmitri buys a bottle of French champagne. \end{tabular}

Solution

To determine how each transaction is included in the calculation of U.S. GDP, we need to categorize them into one of the components: consumption (C), investment (I), government purchases (G), exports (X), or imports (M).

The Pennsylvania Department of Transportation, a state administration, repairs a bridge along PA highway 23, which feeds into the center of Conshohocken.

This transaction is included in GDP as part of government purchases (G). Government spending on infrastructure projects is considered a government purchase.
Frances gets a new smart bird feeder made in the United States.

This transaction is included in GDP as part of consumption (C). When an individual purchases a domestically produced good for personal use, it is considered consumption.
Frances's father in Mexico orders a Martin guitar, made in Pennsylvania, from the producer's website.

This transaction is included in GDP as part of exports (X). The sale of a U.S.-made product to a foreign buyer is considered an export.
Dmitri's employer upgrades all of its computer systems using U.S.-made parts.

This transaction is included in GDP as part of investment (I). Business spending on equipment and technology is considered investment.
Dmitri buys a bottle of French champagne.

This transaction is included in GDP as part of imports (M). When a consumer purchases a foreign-made product, it is considered an import, which is subtracted from GDP.