Thank you for visiting Refer to the following table GDP 5 0 trillion Government purchases 1 0 trillion Transfer payments 0 2 trillion Exports 0 4 trillion Imports 0. This page is designed to guide you through key points and clear explanations related to the topic at hand. We aim to make your learning experience smooth, insightful, and informative. Dive in and discover the answers you're looking for!
Answer :
Final answer:
The sum of investment and consumption in this economy is 4.1 trillion dollars, calculated using the formula for GDP which is GDP = Consumption + Investment + Government Spending + (Exports - Imports). Option C is correct.
Explanation:
To answer this question, we need to understand that GDP (Gross Domestic Product) is made up of four key components: Consumption (C), Investment (I), Government Spending (G), and the Net of Exports and Imports (X-M).
The provided numbers seem to be in trillions, so GDP is 5.0 trillion, Government Spending is 1.0 trillion, Transfer Payments (which do not count towards the GDP) are 0.2 trillion, Exports are 0.4 trillion and Imports are 0.5 trillion. However, we're not provided with any specifics for 'Investment' and 'Consumption' which we're trying to find.
We'll use the formula GDP = C + I + G + (X - M) to solve for C + I. By substituting given values, we can rearrange this to find: C + I = GDP - G + M - X = 5.0 - 1.0 + 0.5 - 0.4 = 4.1 trillion. So, the sum of investment and consumption in this economy is 4.1 trillion dollars.
Option C is correct.
Learn more about GDP Calculation here:
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Thank you for reading the article Refer to the following table GDP 5 0 trillion Government purchases 1 0 trillion Transfer payments 0 2 trillion Exports 0 4 trillion Imports 0. We hope the information provided is useful and helps you understand this topic better. Feel free to explore more helpful content on our website!
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