Tim mows the yard for his neighbors.He spends $1 on gas and charges them $20 for each lawn he mows.What's the total contribution to GDP each time Tim mows a yard?

Question

Quizplus · Accepted Answer

The total contribution to GDP is the total value of goods and services produced in an economy. In this case, Tim's mowing service is a service produced for his neighbors. Therefore, the value of the service is the amount he charges, which is $20. The cost of gas is not included in the contribution to GDP as it is a cost incurred by Tim and not a service produced for his neighbors. Thus, the total contribution to GDP each time Tim mows a yard is $20.

Tim Mows the Yard for His Neighbors