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Quality Motors is a Japanese-owned company that produces automobiles; all of its automobiles are produced in American plants. In 2010 Quality Motors produced $30 million worth of automobiles, with $17 million in sales to Americans, $9 million in sales to Canadians, and $4 million worth of automobiles added to Quality Motors’ inventory. The transactions just described contribute how much to U.S. GDP for 2010?

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jepessoa

Answer:

$30 million

Explanation:

The gross domestic product (GDP) includes the market value of all the final and legal goods and services produced within a country during a period of time (generally one year). The formula to calculate GDP = C + I + G + X - M

Quality Motors manufactured $30 million worth of cars:

  • C = consumption = $17 million
  • X = exports = $9 million
  • I = investment = $4 million

total contribution = $30 million

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