Answered

Economics: Macroeconomics Trends and Forecasting

Which of the following statements is false?

A. Labor income is made up of wages, salaries, and fringe benefits.

B. For purposes of measuring GDP, only net investment is counted.

C. Net investment is the difference between gross investment and depreciation.



Answer :

GinnyAnswer

Final answer:

The false statement is B: For purposes of measuring GDP, only net investment is counted.


Explanation:

Statement B: For purposes of measuring GDP, only net investment is counted is false. In the GDP expenditure equation Y=C+I+G+(X-M), consumption C, investment I, government spending G, and net exports (X-M) are all included in GDP calculations, not just net investment. Net investment is the difference between gross investment and depreciation.


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