{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Assignment 1 - Macro Economics 314 Assignment 1 Page 56 2 a...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Macro Economics 314 Assignment 1 Page 56: 2. a. Consumption goes up $6 billion, investment stays constant, government spending stays constant, net exports stay constant, and GDP increases $6 billion. b. Consumption goes up $6 billion, investment stays constant, government spending stays constant, net exports drop by $6 billion, and GDP stays constant. a. Consumption stays constant, investment goes up $6 billion, government spending stays constant, net exports stay constant, and GDP increases $6 billion. b. Consumption stays constant, investment goes up $6 billion, government spending stays constant, net exports drop by $6 billion, and GDP stays constant. 3. a. Product Approach: contribution to GDP = $2,000,000 (value added by ABC) + $1,800,000 (value added by XYZ, $3,800,000 -$2,000,000) = $3,800,000 Income Approach: contribution to GDP = $1,000,000 (ABC compensation) + $800,000 (XYZ compensation) + $1,000,000 (ABC pre-tax profit) + $1,000,000 (XYZ pre- tax profit, including inventory increases) = $3,800,000 Expenditure Approach: contribution to GDP = $3,000,000 (fixed investment, by purchasers of supercomputers) + $800,000 (inventory investment) = $3,800,000 b. Product Approach: contribution to GDP = $1,500,000 (value added by ABC,
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Background image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}