Scenario: Sarah takes care of her son instead of sending him to a day care that charges $12,000 annually.
-Refer to the scenario above.Which of the following will happen if she puts him into a day care?
A) The country's GDP will increase by $12,000.
B) The country's GDP will remain unchanged.
C) The country's GDP will decrease by $12,000.
D) The country's trade deficit will increase by $12,000.

Question

Quizplus · Accepted Answer

If Sarah puts her son in day care and pays $12,000 annually, this will contribute to the country's GDP as it is a monetary transaction involved in the provision of services. Therefore, the country's GDP will increase by $12,000.

Scenario: Sarah Takes Care of Her Son Instead of Sending