A house built in 2001, sold in 2013. Do we count this in GDP? Yes or No? Why?
Social Studies · Middle School · Wed Jan 13 2021
Answered on
No, the sale of a used house is not typically included in the calculation of Gross Domestic Product (GDP). GDP measures the total value of goods and services produced within a country's borders during a specific time period. The sale of an existing house, in this case, involves the transfer of ownership but does not contribute to the current production of goods and services. GDP focuses on newly produced goods and services, not transactions involving pre-existing assets like real estate. The initial construction of the house in 2001 would have been part of GDP in the year it was built, but subsequent sales of the used house do not contribute to GDP.