Suppose a jar of DeLux popcorn that is ultimately sold to a customer at Friendly Groceries is produced by the following production process: $$\begin{array} { l c c }
\text { Name of Company } & \text { Revenues } & \text { Cost of Purchased Inputs } \
\text { Fulton Family Farm } & \$ 0.50 & 0 \
\text { DeLux Popcorn Co. } & \$ 2.50 & \$ .50 \
\text { Friendly Groceries } & \$ 4.00 & \$ 2.50
\end{array}$$ If the corn was grown and the jar of popcorn produced in the year 2009, but the jar was sold at Friendly Groceries in the year 2010, what is the contribution of these transactions to GDP in the year 2009?

Question

Suppose a jar of DeLux popcorn that is ultimately sold to a customer at Friendly Groceries is produced by the following production process: $$\begin{array} { l c c } 
\text { Name of Company } & \text { Revenues } & \text { Cost of Purchased Inputs } \
\text { Fulton Family Farm } & \$ 0.50 & 0 \
\text { DeLux Popcorn Co. } & \$ 2.50 & \$ .50 \
\text { Friendly Groceries } & \$ 4.00 & \$ 2.50
\end{array}$$ If the corn was grown and the jar of popcorn produced in the year 2009, but the jar was sold at Friendly Groceries in the year 2010, what is the contribution of these transactions to GDP in the year 2009?

Quizplus · Accepted Answer

The contribution to GDP in 2009 is the value added by DeLux Popcorn Co., which is $2.50 (revenue) minus $0.50 (cost of inputs), equaling $2.00. The farm's revenue of $0.50 is also added, totaling $2.50.

Suppose a Jar of DeLux Popcorn That Is Ultimately Sold