Question

"In the economy of Wrexington in 2008, consumption was $5000, exports were $100, government purchases were $900, imports were $200, and investment was $1000. What was Wrexington’s GDP in 2008?"

Answer 1

The GDP in 2008 was $6800

Step-by-step explanation:

The GDP or Gross Dividend Product of the country is the total value of the economic activity or the value of goods and services produced in an economy within a country in a certain year.

The formula to calculate the GDP = C + I + G + ( X - M )

Where,

• C is the consumption
• I is the Investment
• G is the government spending
• X is the value of exports
• M is the calue of imports

Thus, GDP = 5000 + 1000 + 900 + ( 100 - 200)

GDP = $6800