Question

n the economy of Talikastan in 2015, consumption was $700, exports were $200, government purchases were $300, imports were $150, and investment was $400. What was Talikastan’s GDP in 2015? a. $1350 b. $1450

Answer 1

b. $1450

Step-by-step explanation:

The formula to calculate GDP is:

GDP = C + I + G + NX (X-M)

Where:

• C = consumption
• I = Investment
• G = government purchases
• NX = Net Exports (Exports - Imports)
• X = Exports
• M = Imports

Now, we plug the amounts into the formula:

GPD = 700 + 400 + 300 + 50 (200 - 150)

= 1,450