In 2017, Kara sold her used car to Augi's Used Cars, a local dealership, for $2,000. Augi's then serviced and cleaned the car and sold it to Alex for $3,000. How much would these transactions add to GDP in 2017?

Question

Quizplus · Accepted Answer

The GDP only includes the value of final goods and services produced within a country in a given period. The sale of used goods does not count towards GDP. However, the value added by Augi's Used Cars (the $1,000 difference between the purchase and sale price) is considered a service and is included in GDP.

In 2017, Kara Sold Her Used Car to Augi's Used