Question

Suppose the gross domestic product is $15 million, where consumer spending is $4 million, investments are $2 million, government spending is $5 million and exports are $4 million. How much is spend on imports

Answer 1

The spending on imports is $0 million.

Step-by-step explanation:

GDP = C + I + G + (X – M)

Here, C is consumer spending of $4million, I is investment of $2million, G is government spending of $5million, X is exports worth $4million and M are imports which not given in the question. The GDP in the question is given and is $15million.

So by putting values in the equation we have:

15 = 4+ 2 + 5 + (4 - M)

15 - 4 - 2 - 5 - 4 = M

This emplies

M = $0 Million which means that the country has a complete ban on its importation of goods and services.