Below is a list of domestic output and national income figures for a certain year. All figures are in billions. The questions that follow askyou to determine the major national income measures by both the expenditures and the income approaches.CategoryBillionsCategoryBillionsPersonal consumption expenditures$245Net exports11Net foreign factor income4Dividends16Transfer payments12Compensation of employees223Rents14Taxes on production and imports18Statistical discrepancy8Undistributed corporate profits21Consumption of fixed capital (depreciation)27Personal taxes26Social Security contributions20Corporate income taxes19Interest13Corporate profits56Proprietors' income33Government purchases72Personal saving20Net private domestic investment33Instructions: Enter your answers as a whole number.a. Using the above data, determine GDP by both the expenditures approach and the income approach. Then determine NDP.GDP using the expenditures approach = $billionGDP using the income approach = $billionNDP = $| billionb. Now determine NI in two ways: first, by making the required additions or subtractions from NDP (method 1); and second, by addingup the types of income and taxes that make up NI (method 2).Method 1= $billionMethod 2 = $billionc. Adjust NI (from part b) as required to obtain Pl.PI = $billiond. Adjust PI (from part c) as required to obtain DI.DI = $billion

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a. Using the above data, determine GDP by both the expenditures approach and the income approach. Then determine NDP. GDP using the expenditures approach = $ billion GDP using the income approach = $ billion NDP = $ |billion

a. Using the above data, determine GDP by both the expenditures approach and the income approach. Then determine NDP. GDP using the expenditures approach = $ billion GDP using the income approach = $ billion NDP = $ |billion

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter19: Measuring Economic Performance

Section: Chapter Questions

Problem 6P

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