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Exercise Topic 8 Expenditure Approach

This document contains three questions about calculating GDP, GNP, and other economic indicators using expenditure and income approaches. Question 1 provides economic data and asks to calculate GDPmp, GDPfc, GNPfc, GNPmp, and national income. Question 2 provides another data set and asks to calculate similar indicators. Question 3 fills in a national income table, differentiates between GDP and GNP, and explains personal and disposable personal income.

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liyana nazifa
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538 views

Exercise Topic 8 Expenditure Approach

This document contains three questions about calculating GDP, GNP, and other economic indicators using expenditure and income approaches. Question 1 provides economic data and asks to calculate GDPmp, GDPfc, GNPfc, GNPmp, and national income. Question 2 provides another data set and asks to calculate similar indicators. Question 3 fills in a national income table, differentiates between GDP and GNP, and explains personal and disposable personal income.

Uploaded by

liyana nazifa
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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EXPENDITURE APPROACH EXERCISE

Question 1

The following data shows the country Antah Berantah economic activities for year 2019.

Based on the above table, calculate

a) GDPmp
Public consumption + public investment + private investment + change in stock + Net
export
= 5300 + 3200 + 1550 + 50 + (4250 – 2350)
= 12000

b) GDPfc
GDPmp – Indirect taxes + subsidies
= 12000 – 560 + 550
= 11990

c) GNPfc
GDPfc + Net factor income abroad
= 11990 + (-350)
= 11640
d) GNPmp
GDPmp + Net factor income abroad
= 12000 + (- 350)
= 11650

e) National Income
GNPfc – depreciation
= 11640 – 155
= 114852

Question 2

The following table shows the national income data for a country.

Calculate the following:

a) GDPmp
Gross investment + government expenditure + consumption expenditure
= 3000 + 4000 + 6000 = 13000

b) GNPfc
GNPmp – Indirect taxes + subsidies
= (GDPmp + Net income from abroad) – 1000 + 1200
= 13000 + 400 + 200
= 13600
c) National income
GNPfc – depreciation
= 13600 – 800
= 12800

d) Net investment
expenditure – depreciation
= 4000 + 6000 – 800
= 9200

Question 3

The data below shows the components of national income using expenditure approach for
year 2019.

Answer the questions:

a) Fill in (i) to (v) in the table above.

(i) 282 – (200 + 12 + 60 – 40) = 50

(ii) - 272 + 282 + 5 = 15

(iii) GDPfc

(iv) GNPfc

(v) 307 – 20 = 287


b) Differentiate between GDP and GNP.

GDP GNP

limits its interpretation of the extends it to include the net overseas


economy to the geographical economic activities performed by its
borders of the country. nationals.

emphasis production that is emphasis production that is achieved


obtained domestically by citizens living in different nations.

highlights the strength of the country’s highlights the residents’ contribution to


economy. the development of the economy.

c) Brief explain personal income and disposable personal income.

Personal income can be defined as all income collectively received by all


individuals or households in a country. It includes compensation from several
sources, including salaries, wages, and bonuses received from employment.
Disposable personal income is the amount of money that households have
available for spending and saving after income taxes have been accounted for. It is
calculated by minus personal income with personal income tax.
END OF QUESTIONS

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