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Given the following annual information about a hypothetical country, answer questions a through d.

	Billions of Dollars
Personal consumption expenditures	$200
Personal taxes	50
Exports	30
Depreciation	10
Government purchases	50
Gross private domestic investment	40
Imports	40
Government transfer payments	20

a. What is the value of GDP?

pur-new-sol

Computation of Value of GDP:

GDP = C+I+G+X-M

Here,

C = Personal consumption expenditures = $200

I = Gross private domestic investment = $40

G = Government purchases = $50

X = Exports = $30

M = Imports = $40

So,

GDP = 200+40+50+30-40 = 280

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