Question

The national income accounting identity breaks GDP into four expenditure components. To which of the four components would the following belong: A laptop manufactured by Dell (located in the US) and purchased by the Massachusetts state government.

a. Public consumption.
b. Government transfer payments.
c. Government expenditures.
d. Domestic production.

Answer 1

The laptop purchased by the Massachusetts state government belongs to the Government expenditures component of GDP.

Step-by-step explanation:

The laptop manufactured by Dell and purchased by the Massachusetts state government would belong to the Government expenditures component of GDP. This is because the purchase is made by a government entity and is considered a government expenditure on goods and services produced in the economy. Examples of government expenditures include the government buying new equipment, infrastructure projects, or services.