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WAEC Economics 2008 Question 32

Question 32

National Income

Use the table below to answer the question.
Items | $ Million
Final consumption expenditure | 500
Gross private investment | 150
Government purchases | 300
Depreciation | 25
Net factor income | −10
The gross domestic product (GDP) is equal to

  1. A.$825 m
  2. B.$925 m
  3. C.$940 m
  4. D.$950 m.
Show the answer and explanation

Answer: D ($950 m.)

Explanation

GDP = consumption + investment + government purchases = 500 + 150 + 300 = $950 m.