2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020

Question

Question

2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020

2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020 at a price of $16,000 each. How exactly does this affect the GDP in the Delhi in 2019 and 2020, and which categories of GDP (C, 1, G, or NX) are affected? (10 marks)

bussiness

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

Import = 30 cars at a cost of $15,000

Net Export, NX = Export – Import

Net Export, NX = 0 ‑ (30 x $15,000) = ‑ $450,000

Consumption, C = 20 Cars sold at a price of $18,000

= + (20 x 18,000)

= + $360,000

Investment, I = 10 cars remaining with the dealership

= + (10 x 15,000)

= + $150,000

Change inGDP = Consumption, C + Investment, I + Net Export,NX

= $360,000 + $150,000 ‑ $450,000

=$ 60,000

The value added in 2019 is 20 x 3,000 = 60,000.

In 2020:

Consumption, C = 10 Cars sold at a price of $16,000

= + (10 x 16,000)

= + 160,000

Change in Investment, I = 10 cars reduced from the dealership

= ‑ (10 x 15,000)

= ‑ 150,000

Change inGDP = Consumption, C + Investment, I + Net Export,NX

= 160,000 ‑ 150,000 + 0

= + 10,000

The value added in 2020 is 10 x 1,000 = 10,000

answered by: Bhargav Agravat

Add a comment

Answer 2

2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020

Homework Answers

Add Answer to:
2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020

Post as a guest

Earn Coins

2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020

Homework Answers

Add Answer to: 2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020

Post as a guest

Earn Coins

Add Answer to:
2. Assume a Hyundai dealership in Delhi bought 30 Hyundais from Korea at a cost of $15,000 per car in September of 2018. By December 31, 2019 they had sold 20 of the Hyundais at a price of $18,000 each. The remaining Hyundais were sold in January of 2020