Question

Suppose we have a dealer who buys movie tickets from the multiplex and sells them outside the theater for a higher price. The first and the second transactions are counted when GDP is calculated. Which of the following statements is true?

• A. There is no error.
• B. There is an error of double counting.
• C. There is an error as movie ticket sales are not a part of GDP.
• D. There is an error only if the number of tickets sold is greater than 100.

Answer 1

The correct option is B

There is an error of double counting.

This is an act of double counting - as the sale of these tickets will be calculated in the first sale itself. Further, this is also a black market activity as resale at a higher price is not allowed.