Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

In the country of Hypothetica, we have the following information for the year 2015: *Consumption totalled $2 billion, but 25% of this total consisted of

In the country of Hypothetica, we have the following information for the year 2015:

*Consumption totalled $2 billion, but 25% of this total consisted of goods which were initially sold in 2014.

*A total of $250 million worth of new housing stock was sold.

*Labour wage income was $150 million.

*Businesses invested $100 million dollars in new capital (i.e. machinery) stock.

*Businesses also bought $200 million dollars' worth of company shares on the stock exchange.

*Foreigners with working visas living in foreign-only households bought $100 million worth of locally made goods and services.

*The government spent $500 million building roads.

*Hypothetica is a closed economy, thus they are no exports and imports.

Calculate and explain how you obtained the figure (i.e. what did you count, and what did you exclude) for Hypothetica's consumption in 2015

Calculate and explain how you obtained the figure (i.e. what did you count, and what did you exclude) for Hypothetica's investment in 2015

What was Hypothetica's GDP in 2015 using the expenditure method? Explain your answer

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Placement Economics Microeconomics

Authors: Gary L. Stone

4th Edition

1561836699, 978-1561836697

More Books

Students also viewed these Economics questions