Consider the following figures: the GDP of an economy is $300 billion, household consumption is $85 billion, government spending is $140 billion, investments are $50 billion and total imports are $100 billion. What will be the value of total exports?$125 billion$75 billion$25 billion$50 billion
Question
Consider the following figures: the GDP of an economy is 85 billion, government spending is 50 billion and total imports are 125 billion25 billion$50 billion
Solution
The GDP (Gross Domestic Product) of a country is calculated using the formula:
GDP = Consumption + Government Spending + Investments + (Exports - Imports)
Given the figures in the question, we can substitute the known values into the formula:
85 billion (Consumption) + 50 billion (Investments) + (Exports - $100 billion)
Solving for Exports, we get:
Exports = GDP - Consumption - Government Spending - Investments + Imports Exports = 85 billion - 50 billion + 125 billion
So, the value of total exports is $125 billion.
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