By how much does the current GDP rise in the following scenario? A real estate agent sells a house for $250,000 that the previous owners had purchased 10 years earlier for $90,000. The real estate agent earns a commission of $10,000.
A) $160,000
B) $250,000
C) $10,000
D) $90,000
E) $260,000

Question

Quizplus · Accepted Answer

The current GDP rises by the real estate agent's commission of $10,000, as GDP measures the value of new goods and services produced within a country's borders in a given time period. The sale of the house itself does not contribute to GDP because it is not a new production; only the agent's service of facilitating the sale is new production.

By How Much Does the Current GDP Rise in the Following