If GDP = $1,000, government expenditure = $250, consumption = $500, net exports = $100 and...

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Question

If GDP = $1,000, government expenditure = $250, consumption = $500, net exports = $100 and...

If GDP = $1,000, government expenditure = $250, consumption = $500, net exports = $100 and the budget deficit = $40, what is the value of disposal income? Show your work

I got 970 - is this correct?

business economics

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Answer 1

Answer #1

Budget deficit = $40

So,

Tax = Government spending - deficit = 250 - 40

Tax = $210

Hence,

Disposable income = GDP - taxes = 1000 - 210

Disposable income = $790

So, the disposable income is $790.

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Answer 2

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If GDP = $1,000, government expenditure = $250, consumption = $500, net exports = $100 and...

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Add Answer to: If GDP = $1,000, government expenditure = $250, consumption = $500, net exports = $100 and...

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If GDP = $1,000, government expenditure = $250, consumption = $500, net exports = $100 and...