Sally purchases a classic 1964 car she saw for sale on someone's lawn. She then purchases some new parts and spends 120 hours refurbishing the car which she keeps. Which of the following is included in GDP?

Question

Quizplus · Accepted Answer

The amount she paid to buy new parts is included in GDP as it represents a purchase of goods produced in the current period. The purchase of the car itself is not included as it is a used good, and the value of her time is not included as it is not a market transaction.

Sally Purchases a Classic 1964 Car She Saw for Sale