Rhonda sells a house she has owned for 15 years.To make it more marketable,she buys carpeting and has it professionally installed,and buys wallpaper that her daughter hangs.Which items would be included in this year's GDP?
A)the sale price of the house
B)the sale price of the house,carpeting,and wallpaper and the installation fee for the carpet
C)the sale price of the house,carpeting,and wallpaper,the installation fee for the carpet,and the opportunity cost of Rhonda's daughter's time
D)the sale price of the house,carpeting,and wallpaper,the installation fee for the carpet,and the opportunity cost of Rhonda's time
E)the sale price of the wallpaper and carpeting and the installation fee for the carpet

Question

Quizplus · Accepted Answer

The GDP includes the market value of all final goods and services produced within a country in a given period. The sale of the house is not included as it is not a new production. However, the sale of the wallpaper, carpeting, and the installation fee for the carpet are included as they are new goods and services produced in the current year.

Rhonda Sells a House She Has Owned for 15 Years