Question

    Calculate Personal Income:

    GDP

    3000

    Transfer Payments

    500

    Corporate income taxes

    50

    Indirect business taxes

    210

    Personal taxes

    250

    Undistributed corp profit

    25

    Depreciation

    500

    A 3512 Correct Answer Incorrect Answer
    B 2715 Correct Answer Incorrect Answer
    C 2290 Correct Answer Incorrect Answer
    D 3540 Correct Answer Incorrect Answer
    E 4000 Correct Answer Incorrect Answer

    Solution

    NI = GDP + NR - IBT - CC NI = National income NR = + or - Net income from assets abroad (net income receipts) IBT = Indirect business taxes CC = Depreciation NI = 3000 + 0 - 210 - 500 = 2290 Personal Income = NI - corporate taxes - retained earnings + transfer payments PI = 2290 - 50 - 25 + 500 = 2715

    Practice Next