How to check for DOM equality with jQuery?
Although you can compare jquery objects as Matt has shown, or simply with index operator
if($("#list p.selected")[0] == $("#list p:last-child")[0])...this is rarely needed with jQuery. There is a better way!
if($("#list p.selected").is(":last-child"))....or the other way round, more readable
if($("#list p:last-child").is(".selected"))....
jQuery is an object, so you're technically comparing two different (but similar) objects, which will always be false.
Try:
if (jQuery('#list p.selected').get(0) == jQuery('#list p:last-child').get(0))