(d) Assume a 16 year old named William Gates writes a computer program in his garage. The software is stored in his hardware. What is his contribution to GDP? Now, instead assume William Gates incorporates a company called Microsoft, with himself as the only employee. Any production cost is attributed to his salary. He still works in his garage. He creates the same computer program. Suppose he values the computer program for $20,000. What is the contribution to GDP? What is the money that Bill Gates gets in his bank account by the end of the year and how much is registered as salaries? (e) Jeremy buys a house for $50,000. When is the transaction part of GDP?
(d) Assume a 16 year old named William Gates writes a computer program in his garage. The software is stored in his hardware. What is his contribution to GDP? Now, instead assume William Gates incorporates a company called Microsoft, with himself as the only employee. Any production cost is attributed to his salary. He still works in his garage. He creates the same computer program. Suppose he values the computer program for $20,000. What is the contribution to GDP? What is the money that Bill Gates gets in his bank account by the end of the year and how much is registered as salaries? (e) Jeremy buys a house for $50,000. When is the transaction part of GDP?
Chapter5: An Introduction To Macroeconomics
Section: Chapter Questions
Problem 3TY
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just part (d) and (e)
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