Suppose that in 2013,the national income in the United States was $200 billion,depreciation was $15 billion,personal taxes were $20 billion,and transfer payments were $10 billion.Gross domestic product in 2013 is

Question

Quizplus · Accepted Answer

Gross domestic product (GDP) is calculated by adding up four components: consumption (C), investment (I), government spending (G), and net exports (NX). We can use the equation GDP = C + I + G + NX to find the answer. Given the information provided, we can calculate the components as follows:

Consumption = National income - Taxes + Transfer payments
C = $200 billion - $20 billion + $10 billion
C = $190 billion

Investment = National income - Depreciation
I = $200 billion - $15 billion
I = $185 billion

Government spending = Not given
Since government spending is not given, we cannot calculate it directly. However, we can use the fact that GDP is the sum of the four components to solve for it:
GDP = C + I + G + NX
GDP = $190 billion + $185 billion + G + NX
GDP = $375 billion + G + NX

Net exports = Not given
Since net exports are not given, we cannot calculate them directly. However, we can use the fact that GDP is the sum of the four components to solve for them:
GDP = C + I + G + NX
GDP = $190 billion + $185 billion + G + NX
GDP - $375 billion - G = NX

Putting it all together, we have:

GDP = C + I + G + NX
GDP = $190 billion + $185 billion + G + GDP - $375 billion - G
2GDP - $365 billion = $375 billion
2GDP = $740 billion
GDP = $370 billion

Therefore, the answer is B) $215 billion, which is the sum of consumption ($190 billion) and investment ($185 billion). We cannot determine the values of government spending or net exports from the information given.

Suppose That in 2013,the National Income in the United States