Question

Calculate the GDP for a country that in one year sells 10,000 speedboats for $40,000 each and 5,000 race cars for $90,000 each, and nothing else. A speedboat engine contributes $9,000 to the total price, and a race car engine is worth $12,000.

Answer 1

GDP = $850 million.

Step-by-step explanation:

(10,000 × $40,000) + (5,000 × $90,000) = $850 million.

Gross Domestic Product (GDP) is the monetary value of all finished goods and services made within a country during a specific period.

GDP provides an economic snapshot of a country, used to estimate the size of an economy and growth rate.

GDP can be calculated in three ways, using expenditures, production, or incomes. It can be adjusted for inflation and population to provide deeper insights.

Answer 2

GDP is $ 850,000,000.00

Step-by-step explanation:

GDP is an acronym for Gross Domestic Product which represents the value of goods and services in an economy over a period of time,usually a year.

As a result, GDP in this economy can be computed thus:

GDP=quantity of speedboats*selling price of speedboat+quantity of race cars*selling price of race car

GDP=(10,000*$40,000)+(5000*$90000)

GDP=$ 400,000,000.00+$450,000,000.00

GDP=$ 850,000,000.00

The price of the engines at $9000 and $12,000 are relevant anymore as they are already considered in the total price of speedboat and race car.