Question

Components Personal consumption expenditures (C) $9,224.5 Gross private domestic investment (I) $2,209.2 Government consumption expenditures and gross investment (G) $2,523 Exports (X) $1,467.6 Imports (M) $2,229.6 Net exports of goods and services (NX) $ Gross domestic product (GDP) $ This method of calculating GDP, which involves summing the , is called the approach.

Answer 1

• Net Exports = $-762
• GDP = $13,194.70
• Expenditure approach.

Step-by-step explanation:

The Gross Domestic Product (GDP) is the value of the final goods and services produced in a country in a given period (usually a year).

It can be calculated by the formula;

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

= Consumption + Investment + Government Spending + Net Exports

Net Exports = Exports - Imports

= 1,467.60 - 2,229.60

= -$762

GDP = 9,224.5 + 2,209.2 + 2,523 - 762

= $‭13,194.7‬0

This method of calculating GDP is called the EXPENDITURE METHOD because it calculates the amount spent on gods and services in the country because the logic is that the final goods and services produced in the country were spent on by economic agent.