Question

Use the table to answer the question.

Consumption $2500
Investment $1000
Government Spending $1000
Imports $500
Exports $1000
The market value for each type of expenditure is given for a hypothetical country in the table above. Calculate the gross domestic product for this country.

(1 point)
Responses

$4,100
$4,100

$4,000
$4,000

$6,000
$6,000

$5,000
$5,000
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Answer 1

To calculate the gross domestic product (GDP), we use the formula:

GDP = Consumption + Investment + Government Spending + (Exports - Imports)

Plugging in the values:

GDP = $2500 + $1000 + $1000 + ($1000 - $500)
GDP = $2500 + $1000 + $1000 + $500
GDP = $4000

Therefore, the GDP for this country is $4,000.
The correct answer is:

$4,000