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?
A. Consumption will increase by $210,000.
B. GDP will increase by $1000.
C. Consumption will increase by $1,000, and investment will increase by $200,000.
D. Investment will increase by $201,000.
Answer: B
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