Geri purchases a newly constructed house built by a private contractor. Her spending on the house is included in GDP as a part of
A) personal consumption expenditures.
B) depreciation.
C) gross private investment.
D) personal saving.

Question

Quizplus · Accepted Answer

The spending on a newly constructed house is considered as a part of gross private investment, which includes spending on business structures, equipment, and residential structures. Personal consumption expenditures refer to spending by households on goods and services, while depreciation refers to the decrease in the value of existing capital. Personal saving refers to the portion of income that is not spent and is set aside for future use.

Geri Purchases a Newly Constructed House Built by a Private