George and John, stranded on an island, use clamshells for money. Last year Geor

Question

George and John, stranded on an island, use clamshells for money. Last year George caught 400 fish and 5 wild boars. John grew 200 bunches of bananas. In the two-person economy that George and John set up, fish sell for 1 clamshell each, boars sell for 10 clamshells each, and bananas go for 6 clamshells per bunch. George paid John a total of 30 clamshells for helping him to dig bait for fishing, and he also purchased five of John’s mature banana trees for 30 clamshells each. What is the GDP of George’s and John’s island in terms of clamshells?

Explanation / Answer

George’s GDP = 400 x 1 + 5 x 10 – 30 – 5 x 30 = 270 clamshells

John’s GDP = 200 x 6 + 30 + 5 x 30 = 1380 clamshells

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