Economic Awareness - Sectors of Indian Economy
Which of the following is included in the 'Investment' component of GDP by expenditure method?
Which of the following is included in the 'Investment' component of GDP by expenditure method?
medium Q6 of 15
Step-by-Step Solution
Step 1: Understand investment in GDP
Investment includes spending on capital goods and changes in inventories.Step 2: Analyze options
Increase in inventories is part of investment. Purchase of stocks/bonds is financial transaction, excluded. Government social welfare is transfer payment, excluded. Household durable goods are consumption.Final Answer:
Increase in inventories held by firms → Option BQuick Check:
Increase in inventories is included in investment ✅
Quick Trick: Remember inventory changes count as investment.
Common Mistakes:
- Confusing financial assets with real investment.
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