Paper 1 · November 2009 · National Income and Economic Growth
In an open economy.
Consumption expenditure = $100 billion
Investment expenditure = $40 billion
Government expenditure = $40 billion
Exports = $40 billion
Imports = $20 billion
What is the level of GDP?
A$140 billion
B$200 billion
C$220 billion
D$240 billion
Explanation
GDP = C + I + G + (X - M) = 100 + 40 + 40 + (40 - 20) = 100 + 40 + 40 + 20 = $200 billion. The marking scheme confirms answer B.
ZIMSEC Economics Paper 1, November 2009, Q36