Daniel, a U.S. citizen, travels to Mexico and buys a newly manufactured motorcycle made there. His purchase is included in

Question

BlackTom AI · Accepted Answer

To analyze this question, we need to apply the basic idea of gross domestic product (GDP): GDP measures the value of all final goods and services produced within a country’s borders during a given period, regardless of who owns the production or who purchases the goods.
Option 1: 'neither Mexico's GDP nor U.S. GDP.' This is incorrect because the motorcycle was produced in Mexico, so its value counts toward Mexico's GDP.
Option 2: 'U.S. GDP, but it is not included in Mexico's GDP.' This is incorrect because the production occurred in Mexico, so it should be included in Mexico's GDP, not in the U.S. GDP.
Option 3: 'both Mexico's GDP and U.S. GDP.' This is incorrect because GDP is location-based for production; the U.S. GDP would only include production within U.S. borders, not goods produced abroad.
Option 4: 'Mexico's GDP, but it is not included in U.S. GDP.' This is correct: the motorcycle's production happened in Mexico, contributing to Mexico's GDP, and there is no inclusion in U.S. GDP since the production did not occur in the United States.

Daniel, a U.S. citizen, travels to Mexico and buys a newly manufactured motorcycle made there. His purchase is included inSingle choice

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