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What is the gdp of the island-nation

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Exercise:

Yorkland is a small island nation. 

The total population of the island is 1000, out of which 200 earn wage that is on average $50 per year. 

Each wage-earner spends $44 per year to buy consumer goods and services out of which $4 is spent for buying the goods and services from other nations. 

The island exports a total of $1500 worth of goods. 

The Government of the island imposes income tax on wages, which is 10%, and spends all tax money for the island's hospital and school. 

There are only two businesses (services provider and food factory) on the island, and they employ the above mentioned 200 wage-earners. 

The service business spends $600 each year for buying new equipment, while the food factory spends $400. 

Question: What is the GDP (total output) of the island-nation?

Reference no: EM132422393

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