Instead of taking the dirty laundry with you when you go back to visit your pare

Question

Instead of taking the dirty laundry with you when you go back to visit your parents, you use a Laundromat. Your use of the Laundromat means that GDP will decrease and the country's standard of living will fall. your parents' contribution to GDP will increase. GDP will remain the same. what you paid for use of the Laundromat will be included in GDP. real GDP does not change because the clothes are still being laundered but nominal GDP rises since you are now paying for the service. The calculation of GDP excludes the value of government expenditure on office supplies. households' purchases of shampoo. businesses' purchase of new machine tools. a family member painting the family home. expenditure on durable goods.

Explanation / Answer

1. Instead of taking the dirty laundry with you when you go back to visit your parents, you use a Laundromat, you use of Laundromat means that

Solution: D what you paid for use of the Laundromat will be included in GDP

Explanation: Using the Laundromat means that the money you used to pay for the Laundromat will be included in your GDP.

2 The calculation of GDP excludes the value of

Solution: D a family member painting the family home

U.S real GDP excludes the value of underground production and leisure time, therefore family member painting the family home is excluded

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