Question

From the data given below, answer the following questions Personal consumption expenditure $4627 Net interest $400...

From the data given below, answer the following questions
Personal consumption expenditure
$4627
Net interest
$400
Exports
$716
Government Purchases of goods and services
$1175
Corporation Profits
$536
Imports
$818
Net taxes
$1260
Personal income taxes
$1300
Rental income
$28
Depreciation
$716
Gross private domestic investment
$1037
Indirect taxes
$970
Proprietor’s income
$473
Subsidies
$391
Compensation of employees (wages)
$4005
Price level (GDP deflator)
$120
a. What is the value of net export NX?
b. Is the country borrowing from or lending to the rest of the world?
c. What is the value of GDP using expenditure approach?
d. What is the value of nominal GDP?
e. What is the value of Real GDP?
f. What is the value of net investment?
g. What is the value of net domestic income at factor cost?
h. What is the value of net domestic income at market price?
i. What is the value of GDP using income approach?
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Answer #1

a. What is the value of net export NX?

= Exports - Imports
= 716 -818
= -102

b. Is the country borrowing from or lending to the rest of the world?

As the Country's Exports are less than the Imports, thus country is a borrower in this case.

c. What is the value of GDP using expenditure approach?

Using Expenditure Method GDP MP:
= Personal Consumption + Gross Investment + Government Purchases + Net Exports
= 4627+1037+1175-102
= 6737

d. What is the value of nominal GDP?

Nominal GDP is the value of GDP at current prices in the current year = 6737

e. What is the value of Real GDP?

Real GDP = Nominal GDP / Deflator * 100
= (6737 / 120) * 100
= 5614.17

f. What is the value of net investment?

= Gross Private Domestic Investment - Depreciation
= 1037-716
= 321

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