Investment

Which of the following are included in gross private domestic investment?

1. The City of Commerce builds a new 14,000 seat

sports arena.

2. Homer Bod has a new home built for $456,000.

3. Commerce Industries buys a new (German) Krupps

lathe to use in their manufacturing operations.

4. Billionaire Bill Fences buys a beautiful, $4,000,000

antique Oriental rug to go in corporate headquarters

to impress dumb clients.

5. Commerce Motor Superstores starts the year with 300

cars valued at $9,600,000 on their showroom floors.

They end the year with only 85 cars valued at $2,500,000.

6. Steve Stockwell buys 1000 shares of Macrohard

stock, paying $44.585 per share.

7. Texas Tools closes and writes off a construction

building that it paid $1,800,000 for back in 1987.

8. Super salesman, Sam Scheister, buys a new $65,000

Mercedes to drive while calling on his customers.

9. The Fort Worth Kimbell Art Museum buys Picasso’s

“Lady Before a Mirror” for its permanent collection.

A hint or two or three:

Gross Private Domestic Investment:

What does Private mean? Is the City of Commerce private?

To what does Domestic apply? The Krupps lathe is an import, but Commerce Industries is a domestic firm.

What does the word “antique” mean?

What are the components of investment?

Is Picasso still alive and painting? Is the Kimbell private sector?