Question
In a given year, the producer grows 40 million units of a good and the market price for good is $6 per unit. Of the
In a given year, the producer grows 40 million units of a good and the market price for good is $6 per unit. Of the 40 million units produced, 25 million are sold to consumers, 5 million are stored in inventory, and 10 million are sold to the government. The producer pays $70 million in wages to consumers and $25 million in taxes to the government. Consumers pay $15 million in taxes to the government, receive $8 million in interest on the government debt, and receive $5 million in transfer payments from the government. The profits of the producer are distributed to consumers. Calculate GDP using the product approach, the expenditure approach, and the income approach.
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