AP Macroeconomics Question 2: Answer and Explanation

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Question: 2

2. Which of the following would be included in U.S. GDP calculations?

  • A. An auto mechanic fixing his dentist’s car for a filling
  • B. A stay-at-home dad providing childcare for his children
  • C. A worker donating $200 to the Red Cross
  • D. High school students spending their Saturdays building homes for the homeless
  • E. A college student paying another student $50 in cash for a used laptop

Correct Answer: C


C For a transaction to be captured in GDP calculations, it needs to be recorded and reported to the government. The answer is (C) because all other transactions are not reported to the government. On a side note, other countries (United Kingdom and Germany) are looking at ways to include parallel market transactions as part of their GDP.