None of the following activities are included in the calculation of GDP. Which one does NOT result in understating GDP?
A) Volunteer work.
B) Home production, such as housekeeping.
C) The sale of preowned goods, such as used cars.
D) The sale of illegal goods, such as recreational drugs.

Question

Quizplus · Accepted Answer

The sale of pre-owned goods, such as used cars, does not result in understating GDP because these transactions do not represent new production, which is what GDP aims to measure. GDP focuses on current production of goods and services within a country's borders. Transactions involving used goods merely represent a change in ownership of existing products, not the creation of new economic value.

None of the Following Activities Are Included in the Calculation