Answer to Question #6099 in Macroeconomics for Muhannad f hamad

Question #6099
Following is a list of national income figures for a certain year. All figures are in billions. Interest and investment income $ 7 Government current purchases of goods and services 32 Taxes less subsidies on factors of production 18 Indirect business taxes less subsidies 6 Personal consumption expenditures 133 Net investment (net capital formation) 37 Capital consumption allowances (depreciation) 23 Net Income of farms and unincorporated businesses 17 Net exports -8 Profits of corporations and government enterprises before taxes 38 Wages, salaries, and supplementary labour income 108 Calculate GDP using the expenditure method. GDP=$?? (IN BILLIONS)
1
Expert's answer
2012-01-26T13:06:08-0500
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.

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