Describe how transactions would affect gdp accounts

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Reference no: EM134040020

Question

For each of the following, describe how the transactions would affect the GDP accounts of the relevant countries using the income method, the production method and the expenditure method. (a) The US exports $100 in solar panels to Japan that are sold to consumers and used in homes. These panels are produced by a US manufacturer, which pays wages $50 and has no other costs. Japan exports $100 in cars to a distribution firm in the US (assume the car manufacturer has no wage or materials costs). The US distribution firm stores half of the cars and sells the remaining half for $75 total (assume the firm faces no wage or other costs). Report the accounting for both countries in dollars. (b) The Russian army has invaded Ukraine. Russian soldiers earn wages of 10,000 Rubles paid by the government and use ammunition that the government buys for 5,000 Rubles. The ammunition is produced using 2,000 Rubles of imported steel and 100 hours of work by Russian workers; these Russian workers are paid 1,000 Rubles in total. Do the GDP accounting. (c) The retail company Levi Strauss sells 1,000 jeans for a total value of $100,000 to Macy's. To produce these.

Reference no: EM134040020

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