Suppose the following transactions

occur during the current year:
1. felix orders 40 bottles of wine from a french distributor at a price of $30.00 per bottle.
2. a u. s. company sells 200 spark plugs to a korean company at $5.00 per spark plug.
3.
larry, a u. s. citizen, pays $670 for a surfboard he orders from greatwaves (a u. s. company)

complete the following table by indicating how the combined effects of these transactions will be reflected in the u. s. national accounts for the current year.
hint: be sure to enter a "0" if none of the transactions listed are included in a given category and to enter a minus sign when the balance is negative.

amount in dollars

consumption $
investment $
government purchases $
imports $
exports $
net exports $
gross domestic product (gdp) $

Answers

should have 8

Explanation:

Accounting for trade in goods and services

Indication of the combined effects of transactions on the U.S. national accounts for the current year:

1. Dmitri orders 40 bottles of wine from a French distributor at a price of $30.00 per bottle.

Amount  (Dollars)     $1,200            

Consumption          0

Investment              0

Government Purchases   0

Imports Exports    0

Net Exports  0

Gross Domestic Product (GDP) 0

2. A U.S. company sells 200 spark plugs to a Korean company at $5.00 per spark plug.

Amount  (Dollars)  $1,000

Consumption    0

Investment     0

Government Purchases   0

Imports Exports   $1,200 Exports

Net Exports  $1,200

Gross Domestic Product (GDP)  $1,200

3. Jake, a U.S. citizen, pays $670 for a surfboard he orders from Greatwaves (a U.S. company).

Amount  (Dollars)  $670

Consumption  $670

Investment  0

Government Purchases  0

Imports Exports  0

Net Exports 0

Gross Domestic Product (GDP) $670

Explanation:

The Gross Domestic Product (GDP) is the total market value of goods and services produced within an economy for a given period.  It is calculated with this formula: GDP=C+I+G+(X−M) where, C = Consumption of goods and services, I = Investments, G = Government Spending, X = Exports and M = Imports.  It is in turn influenced by transactions that take place on a daily basis.  Some of the transactions do not really affect a country's GDP.  For example, the order of bottles of wine by Dmitri (supposedly a Greek citizen) from a French distributor into (Greece).

a) Consumption = $1,800

b) Imports = $1,200

c) Exports = $1,000

d) Net Export = -$200

e) GDP = $1,670

Explanation:

Consumption is the purchase of a domestic company.

Consumption = 670 + (40 × 30)

                       = 670 + 1,200

                       = $1,800

There no investment or government purchases, therefore they are zero "0"

Imports: the amount spent on purchases of foreign goods.

Imports = Quality of orders × Price

             = 40 × 30

             = $1,200

Exports: the amount spent by foreigners on domestic goods

Exports = Quality exported × Price

             = 200 × 5

             = $1,000

Net exports = Exports - Imports

                    = 1,000 - 1,200

                    = -$200

Gross Domestic Product = C + I + G + (X - M)

GDP = 1,870 + 0 + 0 + (1,000 - 1,200)

        = 1,870 + (-200)

        = 1,870 - 200

        = $1,670

19

Explanation:

Explanation:

Consumption $  670

Investment $  0

Government Purchases $ 0

Imports $  1200 (40 bottles * $30)

Exports $  1000 (200 plugs * $5)

Net Exports $  (200). This is negative as imports are greater than exports.

Gross Domestic Product (GDP) $470.

{GDP formula : Consumer expenditure  + Investment expenditure  + Government expenditure  + Total exports  - Total imports.

GDP: 670 + 1000 - 1200 = 470}



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