Investment, as a part of GDP, includes:
A) spending on stocks, bonds, and other types of financial instruments.
B) goods bought by firms that plan to use those purchases to produce other goods and services in the future.
C) goods used by government-contracted firms to build roads or bridges.
D) buying a house to renovate and resell it.

Question

Quizplus · Accepted Answer

Investment in GDP represents the spending on goods and services that are expected to produce future benefits. Therefore, buying goods by firms that plan to use them to produce other goods and services in the future is considered investment. Spending on financial instruments (stocks, bonds, etc.), buying a house with no intention of renovating and reselling it, and goods used by government-contracted firms are not included in investment.

Investment, as a Part of GDP, Includes