Which of the following transactions would be included in Gross Domestic Product (GDP)?
A) the purchase of new tires by a family to replace worn out tires on the family car
B) the purchase of a used car
C) the purchase of 100 shares of General Motors stock
D) the purchase of 2 grams of cocaine

Question

Quizplus · Accepted Answer

Only goods and services that are newly produced in the current year are included in GDP. The purchase of new tires represents a current production activity and would be included in GDP.

Answer: B, C, D
 The purchase of a used car, stocks, and illegal goods do not represent current production activities and are not included in GDP.

Which of the Following Transactions Would Be Included in Gross