This is just a very narrow frame to view these concepts from. It's not per say wrong, it's a useful model much of the time, but it's silly to insist that it is the only way to look at things and will needlessly cut off useful avenues of analysis. For instance, things can have value, even if they are never a part of a transaction. My work ethic has economic value to me, and if I were to lose it my income would be reduced by 100%, but it's impossible for me to sell it because it is impossible for anyone else to possess it; it's price is undefined. Similarly, no one has ever paid the algae and plants to produce oxygen, and no one has ever paid the sun to shine. But without these ecosystem services, the GDP of the world would be reduced by 100%.

If these examples are too abstract for your taste, there are many other examples. No one pays for volunteer work (by definition), but there's lots of volunteer work that, if people stopped doing it, our society would grind to a halt. One example is open source software; most of the work which goes into it is unpaid, yet our industry cannot function without it. Another is parenting; most people aren't compensated for having & raising children - indeed, it costs them huge amounts of money - but there is no economy without people performing this function.

I submit there are more things in the economy than are dreamt of in this philosophy.