Question

At a port in Kenobi Bay in the island nation of Obi-Taiwan, a cargo ship is currently being loaded and unloaded. Kenobi bay handles $333383328 of trade every year. A cargo container of Chinese consumer electronics is one such container on the ship. If that container contains 50 phones worth $298 each and 30 tablets worth $306 each, how much will it affect Obi-Taiwanese GDP when those items are sold? The GDP will decrease by $ Blank 1. Calculate the answer by read surrounding text. . If Obi-Taiwan sends that cargo container back to China loaded with 24 laptop computers each worth $914 on the Chinese market, how much will Obi-Taiwan's GDP change when they are sold? GDP will increase by $ Blank 2. Calculate the answer by read surrounding text. After just those two trades, Obi-Taiwan's net exports are $ Blank 3. Calculate the answer by read surrounding text. .

Answer 1

Import is regarded as the leakages from the circular flow of income (GDP). Y=C +I +G +x—M

Obi-Taiwan's import value from Chinese container

= 50×298+30×306= $24080

So Obi-Taiwan's GDP Decreases by $24080

Now if container is sent back to China with laptops, it is an

export. Export is regarded as the injection to the circular flow of income (GDP)

Export value =24×914 = $21936

So now Obi-Taiwan's GDP increases by $21936

After just two trades Obi-Taiwan's net export =export - import =21936—24080=—2144