Question

# Personal consumption expenditures \$245 Net foreign factor income 4 Transfer payments 12 Rents 14 Consumption of...

 Personal consumption expenditures \$245 Net foreign factor income 4 Transfer payments 12 Rents 14 Consumption of fixed capital (depreciation) 27 Statistical discrepancy 8 Social Security contributions 20 Interest 13 Proprietors’ income 33 Net exports 11 Dividends 16 Compensation of employees 223 Taxes on production and imports 18 Undistributed corporate profits 21 Personal taxes 26 Corporate income taxes 19 Corporate profits 56 Government purchases 72 Net private domestic investment 33 Personal saving 20

4. (Chapter 27) Use the attached National Income and Output Worksheet, and the national income data table on page 550 of your textbook (problem # 4) to compute the followings using both the Expenditure Approach and the Income Approach (be sure to fill in the values and show the calculations): (a) GDP, (b) NDP, (c) NI, (d); Adjust NI (from part c) as required to obtain PI; (e) Adjust PI (from part d) as required to obtain DI. Explain the followings NIPA concepts:

1. GDP
2. NDP
3. NI
4. PI
5. DI
6. Net Foreign Factor Income?

10pts.

National Income Accounting Worksheet

 Measure Value-Exp. Approach Value-Income Approach Gross Domestic Product (GDP)= Components: C (        ) + Ig (       ) +                    G (       ) +                   = Xn (      ) =GDP= Components: Wages & Salaries (           ) + Rents (            ) + Interest (            ) +                                       Proprietor’s Income (            )       + Corporate Profits   (               ) + Taxes on Production and Imports (              ) -Net Foreign Factor Income (          ) + Statistical Discrepancy (            ) +Consumption of Fixed Capital (                ) =GDP= Net Domestic Product (NDP)= GDP (            ) - Consumption of Fixed Capital (          ) =NDP= GDP (           ) - Consumption of Fixed Capital (          ) =NDP= National Income (NI)= NDP -Statistical Discrepancy (                ) +Net Foreign Factor Income (                ) =NI= Components: Wages & Salaries (           ) + Rents (            ) + Interest (            ) +                                      Proprietor’s Income (            )       + Corporate Profits    (               ) + Taxes on Production and Imports (              ) =NI= Personal Income (PI)= National Income -Taxes on production and Imports (              ) -Social Security Contributions (            ) -Corporate Income Tax (               ) -Undistributed Corporate Profit (              ) + Transfer Payments (                ) =PI= National Income -Taxes on production and Imports (              ) -Social Security Contributions (            ) -Corporate Income Tax (               ) -Undistributed Corporate Profit (              ) + Transfer Payments (                ) =PI= Disposable Income (DI)= PI -Personal Taxes (               ) =DI= PI -Personal Taxes (               ) =DI= 