Q3. In a simple economy, suppose that all income is either compensation of employees or profits. Suppose also that there are no indirect taxes. Calculate gross domestic product from the following set of numbers. Show that the expenditure approach and the income approach add up to the same figure Consumption Investment 10 $9,500 3,000 Depreciation Profits 1,750 2,400 Exports Compensation of employees Government purchases Direct taxes 850 11,500 3,200 1,200 Saving Imports 1,600 900

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Q3. In a simple economy, suppose that all income is either compensation of employees or profits.
Suppose also that there are no indirect taxes. Calculate gross domestic product from the following set
of numbers. Show that the expenditure approach and the income approach add up to the same figure
Consumption
Investment
$9,500
3,000
1,750
Depreciation
Profits
2,400
Exports
Compensation of employees
Government purchases
Direct taxes
850
11,500
3,200
1,200
Saving
Imports
1,600
900
Transcribed Image Text:Q3. In a simple economy, suppose that all income is either compensation of employees or profits. Suppose also that there are no indirect taxes. Calculate gross domestic product from the following set of numbers. Show that the expenditure approach and the income approach add up to the same figure Consumption Investment $9,500 3,000 1,750 Depreciation Profits 2,400 Exports Compensation of employees Government purchases Direct taxes 850 11,500 3,200 1,200 Saving Imports 1,600 900
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