Part 1:
Exports = $2400
Imports = $1200
Since, the exports are more than the Imports, this particular economy is Exporting Economy
Part 2:
Expenditure Approach
GDP as per Expenditure Approach = Consumption + Investment + Government Expenditure + Exports – Imports
=16000+4400+4000+2400-1200 = 25,600
Income Approach
GDP as per Income Approach= Total National Income + Sales Taxes + Depreciation + Net Foreign Factor Income
Net Foreign Factor Income – the difference between the total income that a country’s citizens and companies generate in foreign countries, versus the total income foreign citizens and companies generate in that country.
=11600+2684+6000+5316 = 25,600
Part 3:
GDP is measurement of Economic activity of a particular period. If you buy a newly built home, it directly contributes to total output of the current period (GDP), for example through investment in land and building materials as well as creating jobs. The local area also profits when new houses are built as newcomers will start using local shops and services.
Buying and selling existing homes does not affect GDP in the same way. The accompanying costs of a house transaction still benefit the economy, however. These can include anything from estate agent, legal or surveyor fees to buying a new sofa or paint.
Conclusion: The sale of house is not to be included in the GDP for the period, irrespective of the amount for which the same have been sold.
Issue 18/08/2017 We Prepare for Future Careers JUAL Revision Date 25/06/2018 Form No.ECTIACAITOS OU Group Work...
Issue 18/08/2017 We Prepare for Future Careers JUAL Revision Date 25/06/2018 Form No.ECTIACAITOS OU Group Work 1 Question 1: The table below gives some of the items in the U.S. National Income and Product Accounts in 2017. (6 marks) Item Wages 11,600 Consumption Expenditure 16,000 Indirect taxes 2,684 Interest, rent, and profit 6,000 Investments 4,400 Government Expenditure 4,000 Depreciation 5,316 Exports 2,400 Imports 1200 1. Given the above information, is this economy a net exporter or a net importer? (1...
Issue 18/08/2017 We Prepare for Future Careers JUAL Revision Date 25/06/2018 Form No.ECTIACAITOS OU Group Work 1 Question 1: The table below gives some of the items in the U.S. National Income and Product Accounts in 2017. (6 marks) Item Wages 11,600 Consumption Expenditure 16,000 Indirect taxes 2,684 Interest, rent, and profit 6,000 Investments 4,400 Government Expenditure 4,000 Depreciation 5,316 Exports 2,400 Imports 1200 1. Given the above information, is this economy a net exporter or a net importer? (1...
Issue 18/08/2017 We Prepare for Future Careers JUAL Revision Date 25/06/2018 Form No.ECTIACAITOS OU Group Work 1 Question 1: The table below gives some of the items in the U.S. National Income and Product Accounts in 2017. (6 marks) Item Wages 11,600 Consumption Expenditure 16,000 Indirect taxes 2,684 Interest, rent, and profit 6,000 Investments 4,400 Government Expenditure 4,000 Depreciation 5,316 Exports 2,400 Imports 1200 1. Given the above information, is this economy a net exporter or a net importer? (1...