A.

A used car dealer buys a car for $3,000 and resells it for $3,300
GDP = C + I + G + N
Buy $3,000
Sell $3,300
Value Added $300
GDP 300
B. A company sells 1000 hard disks for $500 each. Of these, it sells 600 to
other commpanies for production and 400 to indviduals

Unit Price Total

Investment 600 $ 500 $ 300,000
Consumption 400 $ 500 $ 200,000
Total $ 500,000
GDP $ 500,000
C. A company sells 50 computers at a retail price of $1000 a piece and 100 software package
company sells 25 computers at $800 and 50 software packages at $20 a piece to wholesalers
and the software pacages at $75 apiece

Company
quantity price total
computer $ 50 $ 1,000 $ 50,000
to consumers
software $ 100 $ 50 $ 5,000
$ 55,000

Quantity Price Total

computer $ 25 $ 800 $ 20,000
to wholesalers
software $ 50 $ 20 $ 1,000
$ 21,000
Total Consumptive $ 76,000
nd 100 software packages at a retail price of $50 a piece to consumers. The same
0 a piece to wholesalers. The wholesalers then sell the 25 computers at $1,250 a piece

Wholesaler
Quantity Price
Computer $ 25 $ 1,250
Software $ 50 $ 75

Value Added by Wholesaler $ 14,000 ($35.000-$21.000)

Consumptive $ 76,000 ($55.000+$21.000)
GDP $ 90,000
 Total
$ 31,250
$ 3,750
$ 35,000
5.000-$21.000)
5.000+$21.000)
Use the following table showing the producion of 500 boxes af cereal to calculate contribution to GDP:

Participants Material ($) Value of Sales ($) Value added ($)

Farmer 0 150 150
Mill 150 250 100
Cereal Maker 250 600 350
Wholesaler 600 800 200
Grocery store 800 1000 200

Calculate value added at each stage, value of all sales, total value added, contribution to GDP
Total value added 1000
Total value of sales 2800
Assuming each puchase by participants as a Investment, total I = $1800
Assuming grocery store will sell to consumers, so total C = $1000
So GDP = $2800 (assuming G and X equal to 0)
al to calculate contribution to GDP:

ded, contribution to GDP

There are three firms in economy : X, Y, Z. Firm X buys $200 worth of goods from firm
Firm Y buys $150 worth of goods from X and $250 from from Z and produces 300 units
Firm Z buys $75 fromX and $50 from Y and produce 300 units at $2 per unit.
What is GDP? Gov Revenue if VAT @10%, Income Tax @10%, 10% sales tax on final

FIRM X
Participants Material
firm y $ 200
firm z $ 300
Total $ 500
Value of Sales $ 1,000 (250 x $4)
Value Added $ 500
VAT $ 50 (10% x Value Added)
Income Tax $ 100 (10% x Value of Sales)

Total Value Added $ 2,375

Total VAT $ 238
Total Income Tax $ 340
Final Output $ 2,953
Tax on Final
$ 295
Output
GDP $ 3,248
 $200 worth of goods from firm Yand $300 worth of goods from firm Z and produces 250 units of output at $4 per unit
m from Z and produces 300 units of output at $6 per unit.
0 units at $2 per unit.
x @10%, 10% sales tax on final output?

FIRM Y
Participants Material
firm x $ 150
firm z $ 250
Total $ 400
Value of Sales $ 1,800 (300 x $6)
Value Added $ 1,400
% x Value Added) VAT $ 140 (10% x Value Added)
% x Value of Sales) Income Tax $ 180 (10% x Value of Sales)
nits of output at $4 per unit

FIRM Z
Participants Material
firm x $ 75
firm y $ 50
Total $ 125
Value of Sales $ 600 (300 x $2)
Value Added $ 475
VAT $ 48 (10% x Value Added)
Income Tax $ 60 (10% x Value of Sales)