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Assume that a grower of flower bulbs sells its annual output of bulbs to an Internet...

Assume that a grower of flower bulbs sells its annual output of bulbs to an Internet retailer for $70,000. The retailer in turn brings in $160,000 from selling the bulbs directly to final customers. what amount would these two transactions add to personal consumptions expenditures and thus to GDP during the year?

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Answer #1

These two transactions will add $160,000 to personal consumptions expenditures and thus to GDP during the year. Because the total value added = 70,000 + (160,000 - 70,000) = $160,000.

                                                                                                           

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