Suppose that in 2018, the net national income in Madeupistan was $20 billion, depreciation was $1.5 billion, personal taxes were $2 billion, and transfer payments were $1 billion.Gross domestic product in 2018 is

Question

Quizplus · Accepted Answer

Gross Domestic Product (GDP) is calculated by summing up the net national income, depreciation, indirect taxes, and net foreign factor income. 
In this case, we are not provided with the indirect taxes and net foreign factor income. 
So, the GDP for Madeupistan can be calculated as follows: 
GDP = Net national income + Depreciation 
     = $20 billion + $1.5 billion 
     = $21.5 billion 
Therefore, the answer is B.

Suppose That in 2018, the Net National Income in Madeupistan