Answer to Question #162845 in Macroeconomics for John

Question

Using the following national income accounting data, compute GDP by the expenditure approach. All figures are in billions.

 

Profits of corporations and government enterprises before taxes   56

Exports                                                           96

Capital consumption allowances (depreciation)                       48

Government current purchases of goods and services              122

Net income of farms and unincorporated business                     20

Taxes less subsidies on factors of production                            66

Wages, salaries, and supplementary labour income                  100

Gross Investment                                                  86

Indirect taxes less subsidies                                          18

Interest and investment income                                       60

Personal consumption and expenditures                               82

Imports                                                           18

 

Part 1: What the value of GDP using the Expanditure Approch 

Answer 1

Y=consumption+government expenditure+sum of investment+total export - imports$GDP=82+122+86+96-18 =368bn$