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13 April, 16:04

If households receive $100 in interest payments and make interest payments of $110, wages equal $500, rental receipts are $200, royalties are $100, profits are $200, depreciation is $50, and indirect business taxes are $50, then gross domestic income is

A) $1090.

B) $1110.

C) $1180.

D) $1280.

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  1. 13 April, 16:08
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    A. $1090

    Explanation:

    Gross domestic income using income method is the addition of all final income. Depreciation is added to get from net domestic income to the gross total domestic income. The same thing done with indirect business taxes.

    Therefore,

    GDI = Interest payments + wages + rental receipts + royalties + profits + depreciation + indirect business taxes - interest payments made (payable)

    GDI = 100 + 500 + 200 + 100 + 200 + 50 + 50 - 110

    = 1200 - 110

    = $1,090
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