One day, Barry the Barber, Inc., collects $400 for haircuts. Over this day, his

Question

One day, Barry the Barber, Inc., collects $400 for haircuts. Over this day, his equipment depreciates in value by $50. Of the remaining $350, Barry sends $30 to the government in sales taxes, takes home $220 in wages, and retains $100 in his business to add new equipment in the future. From the $220 that Barry takes home, he pays $70 in income taxes. Based on his information, compute Barry's contribution to the following measures of income: gross domestic product, net national product, national income, personal income, disposable personal income.

Explanation / Answer

One day, Barry the Barber, Inc., collects $400 for haircuts. Over this day, his equipment depreciates in value by $50. Of the remaining $350, Barry sends $30 to the government in sales taxes, takes home $220 in wages, and retains $100 in his business to add new equipment in the future. From the $220 that Barry takes home, he pays $70 in income taxes.

Based on his information, compute Barry's contribution to the following measures of income:

gross domestic product,= $400

net national product,=$350,

personal income,=$220

disposable personal income.=$150

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