Using the following national income accounting data, compute GDP by both the expenditures and income approaches. All figures are in billions. Category Profits of corporations and government enterprises before taxes Exports Capital consumption allowances Government current purchases of goods and services Net income of farm and unincorporated businesses Taxes less subsidies on factors of production Wages, salaries, supplementary labour income Gross investment Indirect taxes less subsidies on products Interest and investment income Personal consumption expenditures Imports Using the expenditures approach, GDP = $ Using the income approach, GDP = $ billion billion Value $46 94 65 113 24 75 371 167 11 59 284 7

Using the following national income accounting data, compute GDP by both the expenditures and income approaches. All figures are in billions. Category Profits of corporations and government enterprises before taxes Exports Capital consumption allowances Government current purchases of goods and services Net income of farm and unincorporated businesses Taxes less subsidies on factors of production Wages, salaries, supplementary labour income Gross investment Indirect taxes less subsidies on products Interest and investment income Personal consumption expenditures Imports Using the expenditures approach, GDP = $ Using the income approach, GDP = $ billion billion Value $46 94 65 113 24 75 371 167 11 59 284 7

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Using the relevant information below: Gross Domestic Product (GDP) gross domestic product = consumption + investment + government purchases + net exports GDP = C + I + G + (X − M), calculate GDP using the expenditure approach. Inventory investment $50 billion Fixed investment $120 billion Consumer durables $420 billion Consumer nondurables $275 billion Interest $140 billion Indirect business taxes $45 billion Government wages and salaries $300 billion Government purchases of goods and services $110 billion Imports $80 billion Exports $40 billion Profits $320 billion Services $600 billion
The income and expenditure approaches to measuring a nation's GDP can be combined using the circular flow model. Categorize each of the following flows as part of either aggregate demand or national income. Consumption (C) Investment (1) Government purchases (G) Net exports (X-IM) Net taxes (NT) Disposable income (DI) While national income and domestic product must be equal, income must also equal expenditure for each of the six sectors in the circular flow diagram: firms, consumers, governments, financial system, investors, and the "rest of the world." For example, the amount of flowing into the financial system sector must equal the amount of flowing out of this sector. Saving (S) Net taxes (NT) Aggregate Demand Categorize each of the following flows as either injections into the circular flow or leakages from the circular flow. Exports (X) Investment (1) Government purchases (G) Imports (IM) National Income Injections Leakages O Save & Continue
Using the following national income accounting data, compute GDP, NDP, and NI. All figures are in billions. Round your answers to one decimal place. category value compensation of employees $ 196.2 U. S. exports of goods and services 19.8 Consumption of fixed capital 11.8 government purchases 59.4 taxes on production and imports 14.4 net private domestic investment 52.1 transfer payments 13.9 U. S. imports of goods and services 16.5 personal taxes Net foreign factor income Personal consumption expenditures Statistical discrepancy 40.5 2.2 219.1 0
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Consider the following table: GDP Depreciation Corporate earnings Transfer Payments Personal Tax Payments National income (NI) equals $11800 billion. (Enter your response as an integer.) Personal income (PI) equals $ 11250 billion. (Enter your response as an integer.) Disposable personal income (DPI)equals $ billion. (Enter your response as an integer.) Billions of dollars $13,200 1,400 1,250 700 1,000
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Consider the following table Previous question GDP Depreciation Corporate earnings Transfer Payments Personal Tax Payments Billions of dollars $13,300 1,450 1,000 600 1,500 National income (NI) equals $ billion (Enter your response as an integer) Personal Income (Pl) equals $ billion (Enter your response as an integer) Disposable personal income (DPI)equals $billion (Enter your response as an integer)
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