Question: Do we get the same GDP using two different methods? An economy produces 1,000,000 automobiles valued at $15,000 each. Of these, 700,000 are sold to
Do we get the same GDP using two different methods?
An economy produces 1,000,000 automobiles valued at $15,000 each. Of these, 700,000 are sold to consumers, 200,000 are sold to businesses, 50,000 are sold to the government, and 25,000 are sold abroad. No automobiles are imported. The automobiles left unsold at the end of the year are held in inventory by the auto producers. The market value of the production of final goods and services in this economy is 1,000,000 autos times
$15,000 per auto, or $15 billion.
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