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An economy produces only 1,000,000 computers valued at $2,000 each
An economy produces only 1,000,000 computers valued at $2,000 each. Of these, 200,000 are sold to consumers, 300,000 are sold to businesses, 300,000 are sold to the government, and 100,000 aie sold abroad. No computers are imported. The unsold computers at the end of the year are held in inventory by the computer manufacturers. What is the value of GDP? A. $0.9 billion. B. $1.0 billion. C. $1.8 billion. D. $2.0 billion. E. $3.8 billion.
Expert Solution
Answer
D .
Explanation
Computation of Value of GDP:
GDP include the market value of all produced final goods and services in the country in a particular time period.
So,
Value of GDP = Number of computers produced in the year * Price
= 1,000,000 * $2,000
Value of GDP = $2,000,000,000 or $2 billion.
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