Suppose That Business Firms Spend $500 Million on New Capital

Multiple Choice

Suppose that business firms spend $500 million on new capital equipment this year.Of this $500 million,$300 million was spent on domestically produced capital and $200 million was spent on foreign-produced capital.All else being equal,these transactions contribute ________ to GDP.

A) $800 million
B) $0
C) $500 million
D) $200 million
E) $300 million