Scenario: Jane sewed a prom dress, which she could have bought for $180 from a store.
-Refer to the scenario above.Which of the following will happen if she sells it for $200 and the total cost incurred by her in making the dress was $150?

Question

Quizplus · Accepted Answer

GDP is the total value of goods and services produced in a country within a given time frame. Jane's selling of the prom dress for $200 adds $200 to the economy, which is higher than the cost incurred in making the dress ($150). The difference between the selling price and the cost incurred is $50. Therefore, the GDP will increase by $50. Option A is incorrect because the dress was not produced in a store but produced by Jane, so it does not count towards the GDP. Option C is wrong because the sale of the dress increases the GDP. Option D is incorrect because trade surplus only applies to international trade, not a scenario where someone is making a single item to sell.

Scenario: Jane Sewed a Prom Dress, Which She Could Have