Question

An economy produces only 1,000,000 computers valued at $2,000 each. Of these 200,000 are sold to consumers, 300,000 are sold to businesses, 300,000 are sold to the government, and 100,000 are sold abroad. No computers are imported. The unsold computers at the end of the year are held in inventory by the computer manufacturers. What is the value of GDP?A. $0.9 billionB. $1.0 billionC. $1.8 billionD. $2.0 billion

Answer 1

D. $2.0 billion

Step-by-step explanation:

The computer are final goods not intermediate thus, the entire value of the produced amount will be considered for the GDP of the country.

1,000,000 computers x $2,000 each = 2,000,000,000

The amount sold abroad will be exports

The amount sold to business will be consider investment.

The amount sold to governemtn government spending

andt he amount to consumers, consumption.

The inventory held will also be part as the GDP as unplanned investment