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Consider an economy with a corn producer, some consumers, and a government

Economics

Consider an economy with a corn producer, some consumers, and a government. In a given year, the corn producer grows 3 million tons of corn, and the market price for corn is $50 per tonne. Of the 3 million tonnes produced, 2 million tonnes are sold to consumers, 0.5 million are stored in inventory, and 0.5 million are sold to the government to feed the army. The corn producer pays $60 million in wages to consumers and $20 million in taxes to the government. Consumers pay $10 million in taxes to the government, receive $10 million in interest on government debt, and receive $5 million in Canadian Pension Plan payments from the government. The profits of the corn producer are distributed to consumers.

a) Calculate GDP using the expenditure approach.

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