The components that comprise a nation’s gross domestic product were identified a

Question

The components that comprise a nation’s gross domestic product were identified and discussed in the chapter. Assume the following accounts and amounts were reported by a nation last year. Government purchases of goods and services were $5.5 billion; personal consumption expenditures were $40.5 billion; gross private domestic investment amounted to $20 billion; capital consumption allowances were $4 billion; personal savings were estimated at $2 billion; imports of goods and services amounted to $6.5 billion; and the exports of goods and services were $5 billion.
a. Determine the nation’s gross domestic product.
b. How would your answer change if the dollar amounts of imports and exports are reversed?

GDP Components* Part A       (in billions) Part B           (in billions) Gross domestic product (GDP)

Explanation / Answer

a) The monetary value of all the finished goods and services produced within a country's borders in a specific time period, though GDP is usually calculated on an annual basis. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory

Hence answer are as follow

GDP Components* Part A       (in billions) Part B           (in billions) Government purchases of goods and services 5.5 5.5 Personal consumption expenditure 40.5 40.5 Gross Private Domestic investment 20 20 Capital consumption allowances 4 4 Personal Investment 2 2 Exports of goods and services 5 6.5 Imports of goods and services -6.5 -5 Gross domestic product (GDP) 70.5 73.5

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