If consumption expenditures are $500 million, spending on gross investment is $100 million, imports are $50 million, exports are $55 million, government spending on goods and services is $400 million, than GDP is
A) $790 million.
B) $905 million.
C) $1,005 million.
D) $1,010 million.

Question

Quizplus · Accepted Answer

GDP is calculated by adding consumption expenditures, gross investment, government spending, and net exports (exports - imports). Therefore, GDP = $500 million + $100 million + $400 million + ($55 million - $50 million) = $1,005 million.

If Consumption Expenditures Are $500 Million, Spending on Gross Investment