1) Analyze why each of the following items is excluded from GDP:  (a) profits from the stock and bond market     (b) transfer payments (c) sale of used goods  (d) goods and services produced in the home

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1) Analyze why each of the following items is excluded from GDP: 

(a) profits from the stock and bond market 

   (b) transfer payments (c) sale of used goods 

(d) goods and services produced in the home. Explain why the following items are included in GDP: 

  (a) depreciation

 (b) change in business inventories

  (c) indirect taxes 

 

2) Explain what net exports are and why they are included in the definition of GDP.