Question

Upon getting a big promotion, Sally decides to buy a house in the neighborhood she grew up in as a child. In fact, the house she buys used to belong to a neighbor of hers, and so she's certain it's in good shape and well worth the $200,000 she pays for it. The only thing Sally needs to do is replace all the gutters for $1,000, which she happily does. How will GDP be affected by Sally's recent purchases?

Answer 1

$1,000

Step-by-step explanation:

The gross domestic product (GDP) is the total production of final and legal goods in the country. Since Sally is buying a used house (not new) then that purchase wouldn't affect the GDP, but replacing the gutters should be included in the GDP (I suppose she is replacing the old gutters with new gutters).