Answer questions 9-13 on the basis of the following data. Personal Taxes Social

Question

Answer questions 9-13 on the basis of the following data. Personal Taxes Social Security Contributions Taxes on Production and Imports Corporate Income Taxes Transfer Payments U.S. Exports Undistributed Corporate Protits Government Purchases Gross Private Domestic Investment 75 U.S. Imports Personal Consumption Expenditures 250 Consumption of Fixed Capital Net Foreign Factor Income Statistical Discrepancy $40 15 20 40 24 35 90 25 10 9. Refer to the above data. GDP is: A. $390 B. $417. C. $422. D. $492 10. Refer to the above data. NDP is: A. $370. B. $402. C. $392. D. $467

Explanation / Answer

9. GDP = Consumption expenditure + Investment expenditure + Government expenditure + Export - Import = $275 + $75 + $90 + $24 - $22 = $417. Answer is B.

10. NDP = GDP - Depreciation . Here depreciation is consumption of fixed capital. So NDP = $417 - $25 = $392. Therefore the answer is C.

11. National Income is GDP or GNP(In case of factor income from abroad) at factor cost i.e NDP - Indirect cost = $392 - $20 = $372. So the answer is B.

12. Personal Income = 314 and Disposable Personal income = 274.

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