MACROECONOMICS
14th Edition
ISBN: 9781337794985
Author: Baumol
Publisher: CENGAGE L
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Chapter 8.A, Problem 3TY
To determine
To calculate: The national income and disposable income for the given cases.
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Assume there are only two producing sector Y & Z in an economy. Calculate
a) Gross value added at market price by each sector
b) National income from the followings:
Items Amount in Crores
Net factor income from abroad- 20
Sales by Y- 1000
Sales by Z- 2000
Change in stock of Z- 200
Closing stock of Y- 50
Opening stock of Y- 100
Consumption of fixed capital by Y & Z- 180
Indirect taxes paid by Y & Z- 120
Purchase of raw material by Y- 500
Purchase of raw material by Z- 600
Exports by Z- 70
(ACADEMIC)
on
Net interest
$739
Net U.S. income earmed abroad
Wages and salaries
Rental income
36
8,735
237
Other business income
1,202
tof
adjustments less business transfers
Change in business payments
262
Inventories
14
Personal consumption
Proprietorial income
Gross investment spending
Indirect business taxes
1,250
1,128
1,479
1,059
1,194
Corporate profits before taxes
Exports
Depreciation
249
1,833
According to the above table, Gross Domestic Product as calculated by the income approach is
Select one:
O a. $14,925 billion.
O b. $10,646 billion.
O c. $10,121 billion.
O d. $15,619 billion.
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- 5. You are given the following information about an economy: $millions GDP at Market Prices 1,,669.4 Imports 290.5 Gross Domestic Capital Formation 48.7 Income accruing to the Public Sector 39.0 Retained Business Earnings 75.9 Exports 273.4 Subsidies 16.8 Factor Payments from Abroad 10.0…arrow_forward5. You are given the following information about an economy: $millions GDP at Market Prices 1,,669.4 Imports 290.5 Gross Domestic Capital Formation 48.7 Income accruing to the Public Sector 39.0 Retained Business Earnings 75.9 Exports 273.4 Subsidies 16.8 Factor Payments from Abroad 10.0…arrow_forward16 - Which of the following is the production value of a Turkish artisan who produces bread in Karabük? a) GDP B) net national income C) GDP D) GDP vs. GNP TO) Added Valuearrow_forward
- ITEMS RM (millions) Agriculture 18,000 Mining 12,000 Manufacturing 22,000 Constructions 8,000 Electricity, gas and water 1,800 Transportation and communication 900 Indirect tax 800 Subsidies 700 Government services 1,700 Other services 900 Capital consumption 500 Income received from abroad 750 Income paid to abroad 450 Based on the table above, calculate: a) Gross Domestic Product (GDP) at market price. b) Gross Domestic Product (GDP) at factor cost. c) Gross National Product (GNP) at factor cost. d) national income. e) What approach did you use to make calculation in question (i)? b) The table below shows national income data for a country R. Year Nominal GNP (RM million) Price Index 2017 16 400 100 2018 18 800 108 i) Calculate real income for 2017 and 2018. ii) How much growth rate from year 2017 to 2018?arrow_forwardGIVE ME A NUMBERS FOR EMPTY BOXES !!!!! CALCULATE !!!!!arrow_forwardNational income accounting for a certain country in the year for 2020 is given in Table 2. Based on the table, answer the following questions. Amount in $ (million) 180 8,120 3,800 1,320 4,230 12,000 10,120 12,100 8,000 3,120 3,240 Items Net factor income Consumption expenditure Public investments Import Export Government expenditure Wages Interest, rent and profit Indirect taxes Subsidies Depreciation a) By using expenditure approach, calculate Gross Domestic Product (GDP) at market price. b) By using income approach, calculate Gross Domestic Product 9GDP) at market price. c) Based on your understanding on Gross Domestic Product (GDP), explain why do you think that GDP Ís important, and what is the limitation of GDP?arrow_forward
- a.) From the following data, calculate national income by income method Items (Units of m) Compensation of employees 800 Mixed income of self-employed 900 Net factor income from abroad - 50 Rent 350 Profit 600 Consumption of fixed capital 200 Net indirect taxes 250 Interest 450 Operating Surplus 1400 b.) From the following data, calculate national income by expenditure method. Items (000) Compensation of employees 1,200 Net factor income from - 20 Net indirect taxes…arrow_forward7arrow_forwardProblem 1 Given the following table: $Billions 40 Depreciation Receipts of factor income from the rest of the world Government purchases Imports Payments of factor income to the rest of the world Net private domestic investment Personal income taxes 30 100 50 50 200 120 Personal consumption expenditures Dividends 600 20 Exports Amount of national income not going to households 60 20 Calculate: 1- GDP 2- GNP 3- NNP 4- National Income 5- Personal Income 6- Disposable Incomearrow_forward
- Component Value ($bil) Component Value (Sbil) Consumption 680 Government outlays 300 Business Fixed Investment 90 Government purchases 220 Residential Investment 40 Labor income 520 Inventory stock, 12/31/22 160 Capital income 260 Inventory stock, 12/31/23 150 Net income of foreigners 40 Imports 140 Taxes, subsidies, and transfers 120 Exports 120 Depreciation 70 For each of the following calculations, show your work! a) Compute net exports (X) and investment (1) for this country. b) Use the spending approach to compute GDP (Y) for this country. c) Use the equation Y-C-G to compute national saving (S) for this country. How does it relate to your answer to part a? d) Briefly discuss how this country's spending components, as proportions of GDP , compare with the US in a recent year. e) Use the income approach to compute GDP for this country. Given your answer to part b, what is the size of the statistical discrepancy?arrow_forwardTyped plzzx Asaparrow_forwardRefer to Table 1. The value for GDP in billions of dollars isA) 950.B) 1,030.C) 1,050.D) 1,110arrow_forward
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