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Why is the sale of a used good generally not counted in current-year GDP?

Answer and explanation

Correct answer: Because its production was already counted in an earlier year

GDP is designed to measure the value of production that takes place during the current accounting period. A used car, machine, or other good was produced and counted when it was new, so selling it again does not represent new current production. The resale price may create income for a seller or an intermediary, but the old good itself is not added again. Hence option B is correct; used goods do have value, and they are not all imports.

Related tags

Used GoodsCurrent ProductionGdp ExclusionGdp And WelfareNational Income And Related AggregatesEconomicsClass 11 Mcq

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