The table below shows the values for several different components of GDP. Category Billions of DollarsPersonal consumption expenditures $280Net foreign factor income 6Transfer payments 9Rents 16Consumption of fixed capital (depreciation) 31Statistical discrepancy 7Social Security contributions 16Interest 14Proprietor's income 31Net exports 12Dividends 10Compensation of employees 258Taxes on production and imports 16Undistributed corporate profits 19Personal taxes 24Corporate income taxes 17Corporate profits 54Government purchases 67Net private domestic investment 31Personal saving 18Imports 13 Instructions: Enter your answers as whole numbers. a. What is the value of exports? $ billion b. What is the value of national income? $ billion c. What is the GDP? $ billion d. What is the value of personal income? $ billion
Question
The table below shows the values for several different components of GDP. Category Billions of DollarsPersonal consumption expenditures billion b. What is the value of national income? billion d. What is the value of personal income? $ billion
Solution
a. The value of exports is not provided in the table.
b. National income is calculated as the sum of compensation of employees, rents, proprietor's income, corporate profits, and net interest. So, it would be 16 billion + 54 billion + 373 billion.
c. GDP is calculated as the sum of personal consumption expenditures, gross private domestic investment, government purchases, and net exports. However, the table does not provide the value for gross private domestic investment, so we cannot calculate GDP with the given information.
d. Personal income is calculated as national income plus transfer payments, less social security contributions and corporate taxes. So, it would be 9 billion - 17 billion = $349 billion.
Similar Questions
This is a component of GDP that is determined by this entity’s spending on public works, national defense, public education and other similar expenditures.Select one:a. Investmentsb. Net Exportsc. Governmentd. Consumption
(a) A hypothetical national income data for a country in particular year is presented below:ITEM $MILLIONWages and salaries 250Income paid abroad 75Income from self-employment 120Stock appreciation 5Interest 10Income received from abroad 50Rent 25Depreciation allowance 3Royalties 2Profits and dividends 35From the data, answer the following questions.Calculate the: Gross Domestic Product (GDP)
If GDP (measured in billions of current dollars) is $5,465, consumption is $3,657, investment is $741, and net exports are –$1,910, then government purchases are:
What is excluded in the calculation of GDP? A. Personal income B. Government transfer payments C. Exports of goods and services D. Business profits
This is a component of GDP that comes from the spending of Households.Select one:a. Consumptionb. Governmentc. Net Exportsd. Investments
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.