Answer to Question #151420 in Microeconomics for Unknown

Question

Calculate the GDP of the Domincan Republic based on the following economic actions:
PRG Inc. Founded using the US capital, produced goods within a year for 200,000 USD
Mike and Sam- The US citizens earned 15,000 USD via fixed-term employment contract
local retail trade turnover 330,000 USD
coffee beans produced and exported in amount of 10,000,000 USD
local citizen earned 1,000 USD via his overseas internship at Renault

Answer 1

Gross domestic product (GDP)is the monetary value of of all final economic goods and services produced in a country during a specific period of time in local currency.

$GDP=National Income+Sales Tax+Depreciation+Net foreign factor income$

National income is the sum of all wages, interest, rent, and profits.

Sales tax are consumer taxes imposed by the government on sales of goods and services.

Depreciation is the cost allocated to a tangible asset over its useful life.

net foreign factor income is the difference between total income earned by a country's citizens and companies in a foreign country and total income earned by citizens and companies locally.

Therefore, GDP=10,000,000+330,000+15,000+1,000+200,000

=10,546,000 USD