If total consumption is $5 trillion, investments $2 trillion, government purchases $1 trillion, exports $1 trillion, and imports $3 trillion, the GDP must equal:
A) $6 trillion.
B) $12 trillion.
C) $9 trillion.
D) $3 trillion.

Question

Quizplus · Accepted Answer

GDP is calculated as the sum of consumption, investments, government purchases, and net exports (exports minus imports). In this case, GDP = $5 trillion (consumption) + $2 trillion (investments) + $1 trillion (government purchases) + ($1 trillion (exports) - $3 trillion (imports)) = $6 trillion.

If Total Consumption Is $5 Trillion, Investments $2 Trillion, Government