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Aleonysh [2.5K]
3 years ago
9

Personal Consumption Expenditures$4,500 Consumption of Fixed Capital150 Gross Private Domestic Investment800 Government Purchase

s950 Exports65 Imports85 Refer to the accompanying data about a hypothetical economy (in billions of dollars). GDP in this economy is Multiple g
Business
1 answer:
Natali [406]3 years ago
8 0

Answer:

The GDP in this economy is $6,230 billion.

Explanation:

The GDP can be calculated using the following formula:

Y = C + I + G + (X - M) ....................................... (1)

Where:

Y = GDP of the economy

C = Personal Consumption Expenditures = $4,500

I = Gross Private Domestic Investment = $800

G = Government Purchases = $950

X = Exports = $65

M = Imports = $85

Substituting the values into equation (1), we have:

Y = $4,500 + $800 + $950 + ($65 - $85)

Y = $6,250 - $20

Y = $6,230

Since the figures are in billions of dollars, the GDP in this economy is therefore $6,230 billion.

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