Question
Suppose a good that sells at the stores for $200 dollars had parts in it that were produced in the United States and Mexico. Specifically,
Suppose a good that sells at the stores for $200 dollars had parts in it that were produced in the United States and Mexico. Specifically, $50 worth of the parts came from Mexico, and $150 worth of the parts came from the United States. How would this good be treated for the purpose of GDP calculations?
a.Regardless of the proportion produced in the U.S. and Mexico, 50% of the value goes to the U.S. and 50% goes to Mexico.
b.Since the majority of the good is produced in the U.S., all $200 worth would be added to the U.S. GDP
c.$150 would be added to U.S. GDP and $50 added to Mexican GDP
d.None of it would be added to U.S. GDP since it is not fully of U.S. origin.
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