Answer to Question #6099 in Macroeconomics for Muhannad f hamad
Following is a list of national income figures for a certain year. All figures are in billions.
Interest and investment income
Government current purchases of goods and services
Taxes less subsidies on factors of production
Indirect business taxes less subsidies
Personal consumption expenditures
Net investment (net capital formation)
Capital consumption allowances (depreciation)
Net Income of farms and unincorporated businesses
Profits of corporations and government enterprises before taxes
Wages, salaries, and supplementary labour income
Calculate GDP using the expenditure method.
GDP=$?? (IN BILLIONS)
GDP (Y) is a sum of Consumption (C), Investment (I), Government Spending (G) and Net Exports (X – M). So Y = C + I + G + (X − M). C is Personal consumption expenditures = 133; I is the sum of Net investment and Depreciation = 37+23 = 60; G is Government current purchases of goods and services = 32; X-M = -8. Thus GDP = $217 billion.