Martin, a U.S. citizen, travels to Mexico and buys a newly manufactured motorcycle made there. His

Question

purchase is included in

O a. U.S. GDP, but it is not included in Mexican GDP.

O b. both Mexican GDP and U.S. GDP.

O c. Mexican GDP, but it is not included in U.S. GDP.

O d. neither Mexican GDP nor U.S. GDP.

Answer 1

The correct answer is:

O c. Mexican GDP, but it is not included in U.S. GDP.

When Martin, a U.S. citizen, buys a motorcycle manufactured in Mexico, that transaction contributes to Mexico's GDP since it reflects production within Mexico's borders. However, it does not contribute to the U.S. GDP, as GDP measures the value of goods and services produced domestically.