When calculating GDP from the expenditure side,which of the following is true of the investment component,Ia?

Question

Quizplus · Accepted Answer

The investment component, Ia, includes changes in inventories (i.e. the difference between the value of goods produced and the value of goods sold) in addition to business fixed investment, residential investment, and government investment. It does not exclude expansions of existing factories or only include decumulation of inventories. It also does not include the transfer of houses between individuals, which is considered part of the consumption component (C).

When Calculating GDP from the Expenditure Side,which of the Following