Questions

Questions

Name:

Institutions:

Questions

Part I

Gross Domestic Product (GDP) refers to the value of services and goods produced in a country over a given period. In addition, the amount is arrived at by evaluation of the figures realized by a country in terms of income and expenditure. The expenditure method applies to Country A. The initial GDP figure is $150, 000 that refers to the 100,000 in the production of cars and 50,000 accrued from importing extra vehicles. Secondly, the income method is used whereby the GDP is at $190,000, which is accruable from the purchase of vehicles worth 90,000 whereby 25,000 for police officers, 10,000 by companies, and 65,000 from exports. GDP is at 50% whereby 50,000 accounts for imported goods, whereas 100,000 accounts for goods produced in the country (Sloman & Sutcliffe, 2002). The GDP per capita is arrived at by dividing the GDP by the population that provides 340,000 and per capita of 0.68. In relation to Keynesian economics, it is evident that the state is unable to produce goods for local consumption. The presence of the government enhances efficiency and money supply that induces economic growth.

Part II

It is evident that the state is unable to produce goods for local consumption. The presence of the government enhances efficiency and money supply that induces economic growth. The United States can be termed as experiencing a slowdown in economic activity because of reduction in the export of commodities into foreign markets .furthermore; this is also attributable to an increase n the number of imports from neighboring states. Moreover, reducing the incidence of unemployment and increasing exports would play a critical role in improving the state of the American economy (Hubbard & O’Brien, 2008).

References

Hubbard, R. G., & O’Brien, A. P. (2008). Economics. Upper Saddle River, N.J: Pearson Prentice Hall.

Sloman, J., & Sutcliffe, M. (2002). Economics. Harlow, England: Prentice Hall/Financial Times.