Use the following information to calculate the level of consumption expenditure in this closed economy: • Real GDP = $1000 . • Taxes = $150 . Government Spending = $200 • Private investment = $250

Gross Domestic Product (GDP) gross domestic product = consumption + investment + government purchases + net exports GDP = C + I + G + (X − M), calculate GDP using the expenditure approach.   Inventory investment $50 billion Fixed investment $120 billion Consumer durables $420 billion Consumer nondurables $275 billion Interest $140 billion Indirect business taxes $45 billion Government wages and salaries $300 billion Government purchases of goods and services $110 billion Imports $80 billion Exports $40 billion Profits $320 billion Services $600 billion

The following table contains data for a hypothetical closed economy that uses the dollar as its currency.  Suppose GDP in this country is $1,540 million. Enter the amount for government purchases. National Income Account Value (Millions of dollars) Government Purchases (GG)   Taxes minus Transfer Payments (TT) 455 Consumption (CC) 700 Investment (II) 490   Complete the following table by using national income accounting identities to calculate national saving. In your calculations, use data from the preceding table. National Saving (S)National Saving (S)  =  =      (y-t-g, g-t, y-c, y-c-g)    =  =      (C,G,Y,I)       $  ______million

Which of the following is true about the components of GDP?   When we buy stocks, this is economic investment. Net exports must always be a negative number. Government purchases make up the largest part of GDP. A refrigerator is a durable consumption good.