Do used car sales count in GDP?


Consider the following scenario:

You decide to purchase a used car (or a house, or anything used for that matter) from a used car dealer. The car's price is $2,500 (and for some reason you do not negotiate, always negotiate!). Out of that $2,500, $800 of it is considered profit for the dealer (meaning that he paid $1,700 for the car). How would this trade enter into Gross Domestic Product (GDP)?

Possible answers given include:

1) All of it: in this scenario the entire $2,500 would be included in GDP

2) The profit or "value added" (note that value added is in quotes because the actual value added is debatable): or the $800 because of an increase in consumption.

3) The value of the car - profit: or $1,700 (I can't think of a logical reason why this could be right)

-or-

4) None of it.

Remember that GDP is calculated using only FINAL goods. Intermediate goods and services are not include in the calculate, so we can immediately get rid of options 1 and 3. Right now it seems as though 4 is the best answer because we do not include used item sales in GDP measures. To count the sale of a used car would be a form of double counting since it was already counted in GDP when it was first produced, and this is wrong.

HOWEVER, the service provided by the used car salesman is something that did occur this year and needs to be included in the GDP measure. So the correct answer is actually 2, because certain actions by the car dealer such as cleaning, displaying, advertising, etc. are current and creating value because someone was willing to pay for it.

TLDR: Include the profit, but not used car value.

Example, car produced in 2012 sells for $14,000:
We include $14,000 in 2012 GDP
Car is then bought by a used car salesman for $7,000 in 2013, NO ENTRY for GDP in 2013
Car is then sold by this used car salesman for $8,000 in 2014, the difference (value added) of $1,000 would be added to GDP in 2014 as a service (consumption)



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92 comments:

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That is very good topic. And the information shared is helpful. You do not think about such things when there are used cars for sale and you just buy it. Thanks!

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William on March 14, 2016 at 3:31 AM said...

All countries and state have their own rules regarding treatment of GDP. So used car will be deal under their ruls

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Hello

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Hello Everyone, lapomicrofinancebank38@yahoo.com is the right place where you can get your financial problems solved. I'm Amanda From kansas Missouri U.S.A, I want to use this medium to share a testimony on how God directed me to a Legit and real money lender who have saved the life of my husband. My husband was at the point of death when he was diagnosed of prostrate cancer, the doctors demanded the sum of $26,000 for my husband operation and medical bills. I began to run heater skater just to sort out for money but I did not succeed in getting any money even family members turn down on me, at this time all hope was gone, after praying so hard. I received a call from a childhood friend whom told she got a loan from Mr Lapo with very low amount of interest. I thought this was a mockery to my situation without any options left I decided to take a try and i applied for the sum of $74,000 shockingly within 24hours I received the loan. I immediately went to the hospital to deposit my husband surgery bills and I also to paid off our debt then also took the left over and expand my business. I am more than grateful to Mr Lapo because if not him I would have been a widow by now. He has done more I expected that's why I want to share my testimony with you in case you are in need of loan or you know someone that needs money for any kind of business or project he offers loan to students, business person's, workers, and types of loans. with a very low interest rate of 2%, so I want to advice and direct you to him if you are seriously in need of money to change situations around for good go to Mr Lapo for help and financial assistance you can contact then through this email: lapomicrofinancebank38@yahoo.com, text or call them on +13137774025 he does not know am doing this i pray that God will bless him for the good things he has done in my life

randy william on February 25, 2018 at 5:17 PM said...

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Dr williams on February 25, 2018 at 8:40 PM said...

Dear Sir /Madam,
Hello , Are you interested to selling one of your kidney for a good amount of {$800.000USD} in India pls kindly Contact us now on our email: columbiaasiahospital01@gmail.com as we are looking for kidney donor, Very urgently in all blood groups. Interested Donor should contact us now.


Best Regards:
Dr. Robert Williams
Columbia Asia Hospital
Phone:+917795188709
WhatsApp: +917795188709

Unknown on March 1, 2018 at 10:47 AM said...

Sir, thank you so much for you genuine spell,my wife is back!!!

Thank you sir for your genuine spells. This is really incredible, and I have never experienced anything like this in my life. Before i met you Sir, i have tried every all probable means that i could to get my wife back, but i actually came to realize that nothing was working out for me, and that my wife had developed lot of hatred for me.. I thought there was n o hope to reunite with my ex wife and kids. But when i read good reviews about your work sir, i decided to give it a try and i did everything that you instructed me and i Trusted in you and followed your instructions just as you have guaranteed me in 48 hours, and that was exactly when my wife called me.. We are more contented now than ever. Everything looks perfect and so natural! Thank you so much for your authentic and indisputable spells. Thanks Sir for your help. If you need help in your marriage of broken relationship,please contact Dr Jack right now for urgent help. Okakagbespelltemple@gmail.com Or Okakagbespelltemple@yahoo.com

Call him now +2348138289852

Unknown on March 3, 2018 at 5:01 AM said...

Do you want to buy or sell your kidney for money, Apollo Hospital is urgently in need for kidney donor at the rate of 1.70 CRORE, Payment procedure 50% (85 LAKHS) advance payment before operation, If any one is willing to sell please contact us through Email: kidneytransplant44@gmail.com

Contact No +918970153756



Waiting for your responds



Best Regards

Addmore 01 on March 5, 2018 at 4:20 PM said...

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Addmore 01 on March 5, 2018 at 4:20 PM said...

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looking for. We offer all Types of loans, such as company loans, car loans, venture Capital, housing loans, student

loans or a loan of your choice at 3% Interest rate. Interested persons should contact us with this Email : Michaelnordmannloanfirm@gmail.com

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Narayana Nospital on March 11, 2018 at 7:38 PM said...

We are urgently in need of k1dney Donors with the sum of ($350,000.00 USD) Three hundred thousand dollars. If anyone is willing to donate,
call number Doctor Patel : +918746079056 Email: narayanahospital85@gmail.com

Dr. Michael Varghese on March 11, 2018 at 7:42 PM said...

This is to inform the general public Male/Female who are healthy and %100 serious in selling their kidney for $450,000 USD, should urgently contact Dr. Michael Verghese. As we have a lot of patients who are here for kidney transplant,Our hospital is specialized in Kidney Surgery/transplant and other major treatment.
Email: drmichealvarghes@gmail.com
Dr. Michael Verghese.
call number: +919500703584
WhatsApp: +919500703584

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pramodtransplant7@gmail.com on March 12, 2018 at 3:08 AM said...

Hello

This is to inform the general public that healthy Kidney donors are needed from all blood groups by Manipal Hospital, each donor gets 1 crore 20 lakhs. Advance payment will be paid first to the donor before the operation will commence after which the balance will be paid after the completion of the operation. hurry now and contact us via email pramodtransplant7@gmail.com or WhatsApp +918867413844

Best regard
Dr Pramod
WhatsApp +918867413844

Anonymous said...

This is my testimony on how i won $50 million dollars. I am from USA I want to use this opportunity to thank Dr Okaya for helping me to win the lottery of $50 million lottery ticket.I have been playing the lottery for the past 7 years now and i have never won. Ever since then i have not been able to win and i was so upset and i need help to win the lottery. so i decided to go online and search for help,there i saw so many good testimony about this man called DR OKAYA of how he have cast lucky spell lotto for people to win the lottery.I contact him also and tell him i want to win a lottery, he cast a spell for me which i use and i play and won $50 million dollars. I am so grateful to this man, just in-case you also need him to help you win Lottery,you can contact him through his email: Okayaspellhelp@gmail.com or call/Whatsapp +27814506790

Sophia Enriquez on March 13, 2018 at 3:28 AM said...


This is a very joyful day of my life because of the help Dr.Okaya has rendered to me , I am out here to spreed this good news to the entire world on how I got my ex love back just yesterday i contacted dr okaya for help ,I was going crazy when my love left me for another girl , But when i met the Email address of Dr Okaya (Okayaspellhelp@gmail.com ) the great messenger to the oracle that he serve,I narrated my problem to Dr Okaya about how my ex love left me and also how i needed to get a job in a very big company. He only said to me that i have come to the right place were i will be getting my heart desire without any side effect .He told me what i need to do After it was been done,In the next 24 hours,My love called me on the phone and was saying sorry for living me before now and also in the next one week after my love called me to be pleading for forgiveness,I was called for an interview in my desired company were i needed to work .I am so happy. Contact this great man too for help, his contact: OKAYASPELLHELP@GMAIL.COM OR PHONE/WHATS APP : +27814506790 or OR His website : https://okayaspellhelp0.wixsite.com/website

pramodtransplant7@gmail.com on March 13, 2018 at 12:41 PM said...


Do you want to sell your kidney for money? Are you seeking for an opportunity to sell your kidney for money due to financial break down and you don’t know what to do, then contact us today and we shall offer you good amount for your Kidney. WhatsApp +918867413844 or email pramodtransplant7@gmail.com

Dr Pramod
WhatsApp +918867413844

Joy ofeimu on March 15, 2018 at 11:56 PM said...



Dr Jack, Here is my testimony from a Heart Warming indebted Client (Joy Ofeimu from United states)

I will try to make this short as possible. In July I found out that my husband of almost 17yrs was having an affair and he actually brought this woman to my home. I was devastated to say the least. I met my husband 18yrs ago and he swept me off my feet and we got married 11 months after we met. We had a great marriage (I thought) we have two beautiful boys. In 2015 we moved 800 miles away to a very small town due to his job. I quit my high paying job at a company that I had worked at for 14yrs to move away from my family and job/career to be a stay at home mom. Then here we are 2 and 1/2 years later going through a divorce and no job. I felt schizophrenic going through all of these emotions from acceptance, to denial, to how can this be and back again. I tried all the best effort i could to get him back from this woman whom he was having an affair with, and make him see how much i love to be with him. but he insisted he never wanted to be with me anymore. Its was almost 4 months since he started living with this other woman, then i decided to use Dr. Jack spells for help because i had no other choice and i felt everything was lost to me. I had the most wonderful and happy marriage after using his spell in just 48 hours, and that was how my marital life was fixed back to its right track. If you are one of the people who is in a loveless and unhappy marriage that cannot be salvaged (and you can only determine that by being very honest with yourself), believe me...there is light at the end of this tunnel. Here is his Email:

Okakagbespelltemple@yahoo.com or Okakagbespelltemple@gmail.com

Call him +2348138289852

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pramodtransplant7@gmail.com on March 16, 2018 at 9:07 AM said...


Do you want to sell your kidney for money? Are you seeking for an opportunity to sell your kidney for money due to financial break down and you don’t know what to do, then contact us today and we shall offer you good amount for your Kidney. WhatsApp +918867413844 or email pramodtransplant7@gmail.com

Dr Pramod
WhatsApp +918867413844

Unknown on March 19, 2018 at 3:45 AM said...

Sir, thank you so much for you genuine spell,my wife is back!!!

Thank you sir for your genuine spells. This is really incredible, and I have never experienced anything like this in my life. Before i met you Sir, i have tried every all probable means that i could to get my wife back, but i actually came to realize that nothing was working out for me, and that my wife had developed lot of hatred for me.. I thought there was n o hope to reunite with my ex wife and kids. But when i read good reviews about your work sir, i decided to give it a try and i did everything that you instructed me and i Trusted in you and followed your instructions just as you have guaranteed me in 48 hours, and that was exactly when my wife called me.. We are more contented now than ever. Everything looks perfect and so natural! Thank you so much for your authentic and indisputable spells. Thanks Sir for your help. If you need help in your marriage of broken relationship,please contact Dr Jack right now for urgent help. Okakagbespelltemple@gmail.com Or Okakagbespelltemple@yahoo.com

Call him now +2348138289852

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pramodtransplant7@gmail.com on March 21, 2018 at 1:51 PM said...

Dear Sir /Madam,
Are you interested to selling one of your kidney for a good amount of {1 crore 20 lakh (Advance money 20 lakhs)} in India pls kindly Contact us now on our email: as we are looking for kidney donor, Very urgently who are group B,group A ,O ve and 0 ve. Interested Donor should contact us now. WhatsApp +918867413844

Best Regards:
DR Pramod
Manipal Hospital
WhatsApp +918867413844
pramodtransplant7@gmail.com

Emerson Jackson on March 21, 2018 at 6:19 PM said...

How My Financial Problems Was Solved with Just a Contact With Dr peter Magic Ring Am here to share my testimony of a kind and truthful great spell caster, Dr peter helped me to revive my business back, my business scrambled at a point that i was not able to feed, me and my family was suffering,i was every were looking for help to restore back my business, my friends were laughing at me i became so poor, i was so lucky when i came across Dr peter a powerful spell caster in Africa website after going through so many reviews on his website i contacted him and i explained my problems to him, he gave me an assurance that i will recover my lost money and properties in a week with his powerful business growth ring, i forwarded him, my details as he asked, he told me he will send me a magic ring that i will use that ring to recover all my lost, i quickly forward him the money he asked of me to purchase the magic ring, when he finished preparing the magic ring he send to me through DHL, here in my country with my home address i sent to him ,And he instructed me on how to command and use it, My friend do you believe today his magic ring has make my business boost, and brought my fame back and am a million times richer as i was before, Dr peter is a great man, If you are in financial Crisis as i was contact him peterwiseherbalcenter@gmail.com or add him on whatsapp line +2349059610643 he is always available to help...

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pramodtransplant7@gmail.com on March 26, 2018 at 8:14 AM said...

Good day everyone
Are you interested in selling one of your kidney for a good amount kindly Contact us now as we are looking for kidney donor, Very urgently who are B+ve , O+ve and A+ve. Donor should be 18 years or above. Advance payment will be paid first to the donor before the operation will commence after which the balance will be paid after the completion of the operation Interested Donor should contact us now. Dr. Pramod Kumar WhatsApp +918867413844 Email: pramodtransplant7@gmail.com

waiting for your response

Thank you
DR Pramod

pramodtransplant7@gmail.com on March 26, 2018 at 8:16 AM said...

Good day everyone
Are you interested in selling one of your kidney for a good amount kindly Contact us now as we are looking for kidney donor, Very urgently who are B+ve , O+ve and A+ve. Donor should be 18 years or above. Advance payment will be paid first to the donor before the operation will commence after which the balance will be paid after the completion of the operation Interested Donor should contact us now. Dr. Pramod Kumar WhatsApp +918867413844 Email: pramodtransplant7@gmail.com

waiting for your response

Thank you
DR Pramod

Stefan Vailds on March 27, 2018 at 5:50 PM said...

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pramodtransplant7@gmail.com on April 4, 2018 at 2:03 PM said...

Hello everyone,
Kidney donor is urgently needed A+, B+, O+, blood group donors between the age of 20-65. We give you all
the entire best attempt, we will give you honest price and best treatment for your transplant as top best medical
treatment it will help your future life, kindly contact us on WhatsApp +918867413844

Best regard
Dr Pramod Kumar
WhatsApp +918867413844
email:pramodtransplant7@gmail.com

pramodtransplant7@gmail.com on April 11, 2018 at 5:51 PM said...

We are urgently in need of kidney donors in Manipal Hospital India for the sum of {1 crore 20 lakhs) Advance money before surgery is (Advance money 20 lakhs) For more info WhatsApp +918867413844 or Email:pramodtransplant7@gmail.com

Thank you.
DR Pramod Kumar

Apollo Hospital on April 14, 2018 at 8:37 AM said...

We are urgently in need of kidney donor in a very good health condition for the sum of $470,000,00 and we will take properly care of the donor doling the whole process, here you can contact us via email address: ahospital661@gmail.com or phone number-+919677345881 whatsApp or call. by name Dr Donald Moore.

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