Suppose that inventories fall by $2 billion, consumption increases by $8 billion, welfare payments decline by $3 billion, export increases by $1 billion and import also increases by $2 billion. ceteris paribus! by how much should measured-gdp change?

The measured-GDP would increase by $5 billion.

Explanation:

Given :

Inventories fall by $2 billion,

Consumption increases by $8 billion,

Welfare Payments decline by $3 billion,

Export increases by $1 billion

Import also increases by $2 billion.

Note: While calculating GDP we will not include Welfare payments in it.

GDP =

GDP = $5 billion