21. The following chart contains data for a hypothetical economy: According to t

Question

21. The following chart contains data for a hypothetical economy: According to the expenditure approach, if depreciation is $125 million, GDP is ________and NDP is ______.

A) $1,900 million; $1,775 million

B) $1,265 million; $1,140 million

C) $1,200 million; $1,075 million

D) $1,325 million; $1,200 million

Consumer Expenditures $700 million Wages $750 Million Investment Expenditures $300 million Interest Payments $140 million Government Expenditures $350 million Interest Receipts $230 million Total Exports $200 million Rent $300 million Total Imports $350 million Profits $60 million

Explanation / Answer

Using expenditure approach,

GDP = C+I+G+(X-M)

Substitute given values as:

GDP = 700+300+350+200-350 = $1200million

Depriciation = $125 million

So, NDP = GDP - Depriciation

Therefore, NDP = 1200-125 = $1075 million

So, the correct answer is C) $1200 million; $1075 million

Related Questions

Navigate

• Browse (All)
• Browse 2
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.