Question

As the chapter states, GDP does not include the value of used goods that are resold.

Answer 1

Answer:

true

Explanation:

GDP is gross domestic product measuring the economic stance of a country by actually using government spending, consumption, saving and investing. So if used items that are resold would actually increase the GDP of an economy drastically as there would be a double, triple or quadruple count in certain items in a country and that would spike tax charges which can affect the life’s of consumers and also buyers by items having ridiculous prices. The imports and exports will also be affected as there’s certain taxes imposed on the items being imported or exported by a country as country’s will also have huge deficits and credits on other countries.

This in turn will have a negative value in the study of a country’s economy and well countries would not trade imports and exports easily as countries which have struggling economies will suffer even more on getting products from other countries and countries which are first world will easily purchase from other countries because they will have weak economies because of multiple counting of a single product being sold or traded. The economies won’t really save or invest a lot as they will increase on their expenditure to obtain what they want and also consumers will suffer with high interest and inflation rates in that economy.

Answer 2

Answer: True

Explanation: because they are already considered in the GDP calculation when they were sold for the first time. Calculate them again means we are doing double counting.