Related to the Economics in Practice on p. 107: The value of the used goods sold on eBay from a U.S. seller to a U.S. buyer is
A) counted in U.S. GDP but not GNP.
B) counted in U.S. GNP but not GDP.
C) counted in both U.S. GDP and GNP.
D) not counted in either U.S. GDP or GNP.

Question

Quizplus · Accepted Answer

The value of used goods sold on eBay from a U.S. seller to a U.S. buyer is not counted in either U.S. GDP or GNP because GDP only measures final goods and services produced in a country's borders within a given time period and GNP only measures the income earned by a country's residents, regardless of their location. Used goods are not considered final goods because they were already counted in GDP or GNP when they were first produced and sold as new goods. Additionally, the seller and buyer are both residents of the U.S., so there is no income flowing into or out of the country.

Related to the Economics in Practice on P