When Mr. Wilson worked full time, he paid a service to have his house cleaned twice a month. Now that he is retired, Mr. Wilson does his own cleaning. What is the effect on GDP?
A) GDP is unaffected by this change.
B) GDP falls as a result of this change.
C) GDP at first rises but then falls.
D) GDP rises as a result of this change.

Question

Quizplus · Accepted Answer

When Mr. Wilson stops paying for the cleaning service and starts doing the cleaning himself, it reduces the amount of money being spent on cleaning services, which leads to a decrease in GDP.

When Mr Wilson Worked Full Time, He Paid a Service to to Have