The following outline provides a complete description of all economic activity in Trivialand for 2003. Compute GDP using both the expenditure approach and the factor payment approach.
1. There are thousands of farmers but only two big business firms in Trivialand: Specific Motors (an auto company) and Super Duper (a chain of food market). There is no government and no depreciation.
2. Specific Motors produced 1,000 small cars, which it sold at $6,000 each, and 100 trucks, which it sold at $8,000 each. Consumers bought 800 of the cars, and the remaining 200 cars were exported to the U.S. Super Duper bought all the trucks.
3. Sales at Super Duper markets amounted to $14 million, all of it sold to consumers.
4. All farmers in Trivialand are self - employed and sell all of their wares to Super Duper.
5. The costs incurred by all of Trivialand's business were as follows.
Specific Motors Super Duper Farmers
Wages $3,800,000 $4,500,000 $0
Interest 100,000 200,000 700,000
Rent 200,000 1,000,000 2,000,000
Purchase of food 0 7,000,000 0