If a country has a GDP of $1.2 trillion and the government spends $300 billion,

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Question: If a country has a GDP of $1.2 trillion and the government spends $300 billion, what percentage of GDP is government spending?

Options:

Correct Answer: 25%

Solution:

Percentage of GDP = (300 billion / 1.2 trillion) * 100 = (300 / 1200) * 100 = 25%.

If a country has a GDP of $1.2 trillion and the government spends $300 billion, what percentage of GDP is government spending?

If a country has a GDP of $1.2 trillion and the government spends $300 billion, what percentage of GDP is government spending?

Step 1: Identify the GDP of the country, which is $1.2 trillion.
Step 2: Identify the government spending, which is $300 billion.
Step 3: Convert the GDP from trillion to billion for easier calculation. 1.2 trillion is equal to 1200 billion.
Step 4: Set up the formula to find the percentage of GDP that is government spending: (government spending / GDP) * 100.
Step 5: Plug in the numbers: (300 billion / 1200 billion) * 100.
Step 6: Calculate the fraction: 300 divided by 1200 equals 0.25.
Step 7: Multiply 0.25 by 100 to convert it to a percentage: 0.25 * 100 equals 25%.
Step 8: Conclude that government spending is 25% of GDP.

Percentage Calculation – Understanding how to calculate a percentage of a whole using the formula (part/whole) * 100.
GDP Understanding – Knowledge of Gross Domestic Product (GDP) as a measure of a country's economic performance.