Final answer:
For the purpose of GDP calculations, the purchase of stocks and bonds is considered a financial investment and does not count in GDP; instead, GDP investment involves buying physical capital goods.
Step-by-step explanation:
When people buy stocks/bonds, we call this financial investment, and it does not count in GDP. The correct answer is b. financial investment: does not. Economists define investment in the context of GDP differently from typical use. While buying stocks and bonds is indeed a type of investment, it's one within the realm of financial markets. For Gross Domestic Product (GDP) calculations, investment refers to the expenditure on new capital goods, like new commercial real estate, equipment, residential housing construction, and inventories. In essence, GDP investment is about the creation and accumulation of physical assets that can be used to produce goods and services within the economy. Business investment, not financial investment, is what's included in GDP, as detailed by the Bureau of Economic Analysis.