The data for the country of Upper Mongoose are given below. All figures are in billions...

Question

Category	Value
Net exports	$50
Value of new goods and services produced in the underground economy	75
Personal consumption expenditures	300
Value of the services of stay-at-home parents	25
Gross domestic investment	100
Government purchases	50
Total	600

Instructions: Enter your answers as whole numbers. C

a. What is Upper Mongoose's GDP for the year?

? billion

b. What is the size of the underground economy as a percentage of GDP?

Instructions: Enter your answers as whole numbers.

a. What is Upper Mongoose's GDP for the year?

? billion

b. What is the size of the underground economy as a percentage of GDP?

? percent

c. By what percentage would GDP be boosted if the value of the services of stay-at-home spouses were included in GDP?

? percent

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Underground economy can also be called the black market. It refers to the activities of a business in a nation that aren't recorded, taxed or regulated through the federal government. Transactions on markets that are black considered as unlawful since the trade is not in accordance with the legal procedure for trading laid down.

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Jessica O'Connor · Accepted Answer

Answer:

The GDP does not include the income from underground activities or personal services provided to households.

The GDP of the upper Mongoose can be calculated as follows:

Net exports + Consumption expenditure + Investment + Purchases

GDP = 50 + 300 + 100 +50

GDP = 500 billion

(b) Subgound economy = 75 billion

Percentage of underground economy = (75/500) x 100 = 15%

(c) If you include the "Stay at-services",

New GDP = 500 + 25 = $525 Billion

25 billion USD GDP Increase

Percentage of GDP growth = (25/500) x 100 = 5%.

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