You buy a new TV that was produced last year. This causes consumption expenditure to increase for this year and investment expenditure to decrease by roughly the same amount.

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When a consumer buys a new TV, it is counted as consumption expenditure. Since the TV was produced last year, it was counted as investment expenditure in the previous year. Therefore, this year's consumption increases while investment decreases by the same amount, balancing out the GDP.

You Buy a New TV That Was Produced Last Year