What would happen to measured GDP if more people started hiring workers to do household chores such as cooking and cleaning?
What will be an ideal response?
GDP is the value of the final goods and services that are produced in an economy over a specified time period. However, GDP, as measured, does not include the value of household production people do for themselves around their homes. Therefore if you wash your car at your home or apartment, the value of the car washing is not included in GDP. However if you hired someone to wash your car at your home or apartment, the value of the car washing would be included in GDP. Thus if more people started hiring workers to do household chores, measured GDP would increase.
You might also like to view...
The cost of reducing unemployment more rapidly by expansionary fiscal and monetary policies is a permanently higher inflation rate.
Answer the following statement true (T) or false (F)
Figure 11-7
The firm in Figure 11-7 is an unregulated monopolist; it will produce which of the following?
A. 175 units at a price of 7 B. 100 units at a price of 6 C. 100 units at a price of 9 D. 150 units at a price of about 7.5
As long as the maximum buying price of a good is less than the minimum selling price of that good, an exchange will occur
Indicate whether the statement is true or false
As the opportunity cost of holding money decreases, the quantity demanded of money
A) increases. B) decreases. C) remains unchanged. D) increases, then decreases. E) decreases, then increases.