Suppose GDP is $16 trillion, with $10 trillion coming from consumption, $2 trillion coming from gross investment, $3.5 trillion coming from government expenditures, and $500 billion coming from net exports. Also suppose that across the whole economy, depreciation (consumption of fixed capital) totals $1 trillion.

Remaining information:

From these figures, we see that net domestic product equals:

a. $17.0 trillion.

b. $16.0 trillion.

c. $15.5 trillion.

d. None of the above * **right answer

Answer:

Option D, None of the above

Explanation:

The net domestic product (NDP) is equivalent to the gross national product (GDP) greater than the capital goods depreciated by a government. Capital spent throughout the year in the form of housing, automobiles or equipment is paid for by the net domestic product.

NDP is the value for a particular period of time for all goods and services produced in a country. This is a gross national product, or GDP minus a depreciation of capital.

"The factor-priced net domestic product is the sum total of the net value added during an accounting year by all manufacturers in the country's domestic region."

D. None of the above