A very small country's gross domestic product is $12 million.

a) If government expenditures amount to $7.5 million and gross private domestic investment is $5.5 million, what would be the amount of net exports of goods and services?

Question

Business

Lucia Schultz

26 March, 14:29

A very small country's gross domestic product is $12 million.

a) If government expenditures amount to $7.5 million and gross private domestic investment is $5.5 million, what would be the amount of net exports of goods and services?

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Answers (1)

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Gibson · Answer 1

The amount of net exports of goods and services is - $1 million.

Explanation:

The gross domestic product (GDP) is equal to the total value of the products and services that are produced in a country in a specific period of time. In this case, we will have that GDP would be:

GDP = I+G+NX

I = investment

G = government expenditure

NX = net exports

Then, we replace the formula and isolate NX:

$12=$5.5+$7.5+NX

NX = $12-$5.5-$7.5

NX = - $1

A very small country's gross domestic product is $12 million.a) If government expenditures amount to $7.5 million and gross private domestic investment is $5.5 million, what would be the amount of net exports of goods and services?

A very small country's gross domestic product is $12 million.

a) If government expenditures amount to $7.5 million and gross private domestic investment is $5.5 million, what would be the amount of net exports of goods and services?