In each of the following cases, determine how much gdp and each of its components is affected (if at all).
a. debbie spends $300 to buy her husband dinner at the finest restaurant in boston.
b. sarah spends $1200 on a new laptop to use in her publishing business. the laptop was built in china.
c. jane spends $800 on a computer to use in her editing business. she got last year’s model on sale for a great price from a local manufacturer.
d. general motors builds $500 million worth of cars, but consumers only buy $470 million worth of them.

A) The GDP increases by $300 since a dinner is considered a final service, it is part of consumption.

B) The GDP decreases by $1,200 since the laptop is imported from China, imports reduce net exports.

C) The GDP is not affected since the computer was manufactured last year.  

D) The GDP increases by $500 since the cars are final products ($470 million are considered consumption and $30 million investment).

the answer is "b.the increased supply will create a surplus. "

the essential thought behind price controls is straightforward - utilize the power of law to modify the equilibrium of a market. for instance, the legislature may choose that the steel business needs to survive, and in this way pass a law to set a value floor on steel. this implies all steel sold must offer at or over the floor value, which must be set over the equilibrium cost for it to have any impact. the switch could likewise happen - the administration can choose that steel is excessively costly and set a value roof underneath its equilibrium value, with the goal that all steel must be sold at or beneath that ceiling.