Answer to Question #300647 in Microeconomics for Aish

Question

As the chapter states, GDP does not include the value of used goods that are resold. Why would including such transactions make GDP a less informative measure of economic well-being?

Answer 1

These goods should not be included in the Gross Domestic Product (GDP) as they were already captured in the GDP of the year they were produced and including them would overestimate a nation's GDP and fail to provide the actual growth.