Neco Model Questions Vol1 2021 Economics Question 7

The following data relate to the economy of Nairaland for the year 2022 (all figures are in billions of naira): - Consumption (C) = 4,500 - Investment (I) = 1,200 - Government spending (G) = 800 - Exports (X) = 600 - Imports (M) = 700 - Indirect taxes (T) = 500 - Subsidies (S) = 150 - Depreciation (capital consumption allowance) (D) = 300 - Net factor income from abroad (NFIA) = 80 Using the above information, answer the following: a) Calculate the Gross Domestic Product (GDP) at market price. b) Determine GDP at factor cost. c) Compute Net National Product (NNP) at market price. d) Find Gross National Income (GNI) and Net National Income (NNI). e) The government decides to increase its spending by 10 % and finances the increase entirely by raising indirect taxes. Discuss, with reference to the Keynesian multiplier, the likely impact of this policy on the equilibrium level of national income.