Macroeconomics
10th Edition
ISBN: 9780134896441
Author: ABEL, Andrew B., BERNANKE, Ben, CROUSHORE, Dean Darrell
Publisher: PEARSON
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Question
Chapter 2, Problem 4NP
(a)
To determine
To find: the contribution made to
(b)
To determine
To find: the contribution made to GDP of current year in terms of production, expenditure and income with respect to the transaction which involves in purchasing a historical mansion at a brokerage fee of 6%.
(c)
To determine
To find: the contribution made to GDP of current year in terms of production, expenditure and income with respect to the transaction which involves a homemaker becoming part of the workforce.
(d)
To determine
To find: the contribution made to GDP of current year in terms of production, expenditure and income with respect to the transaction which involves a Japanese firm constructing an auto plant in the U.S.A
(e)
To determine
To find: the contribution made to GDP of current year in terms of production, expenditure and income with respect to the transaction which involves in a lottery winning.
(f)
To determine
To find: the contribution made to GDP of current year in terms of production, expenditure and income with respect to the transaction where an individual appears on television in publicizing a state lottery.
(g)
To determine
To find: the contribution made to GDP of current year in terms of production, expenditure and income with respect to the transaction where a vehicle fleet is being replaced with the old ones sold.
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1) U.S. real GDP is substantially higher today than it was 60 years ago. What does this tell us, and what does it not tell us, about the well-being of U.S. residents? What are the limitations of the GDP as a measure of economic well-being? Given the limitations, why is GDP usually regarded as the best single measure of a society's economic well-being? 2) What is an intermediate good? How does an intermediate good differ from a final good? Explain why it is the case that the value of intermediate goods produced and sold during the year is not included directly as part of GDP, but the value of intermediate goods produced and not sold is included directly as part of GDP. 3) GDP is defined as the market value of all final goods and services produced within a country in a given period of time. In spite of this definition, some production is left out of GDP. Explain why some final goods and services are not included.
2.Now, from our class discussions I created an example that you inherited the company, --let’s called is U-- that owns the land growing the trees and you sell your cut down trees to Company V for $30,000. Company V converts your trees into logs and sell them further down the industry supply chain. Think about the impact of this transaction between Company U and Company V on increasing the GDP. Which one of the parts of the GDP formula does this $30,000 transaction increase: C, I, G, X, or I? Correctly identify which one increases GDP and why you chose that part of the GDP impacted.
Consider the following data for a hypothetical economy that produces two goods, milk and honey.
Prices
Year 1
Year 2
Quantity Produced
milk (litres)
100
135
honey (kg)
35
22
a. Compute nominal GDP for each year in this economy.
Nominal GDP in year 1: $
Nominal GDP in year 2: $
milk ($/litre)
4
3
honey ($/kg)
3
4
(Round your response to the nearest whole number.)
(Round your response to the nearest whole number.)
The percentage change in nominal GDP from year 1 to year 2 is%. (Round your response to two decimal places.
Use the minus sign to enter negative numbers.)
b. Using year 1 as the base year, compute real GDP for each year using the traditional approach.
Real GDP in year 1year 1 prices- $
Real GDP in year 2year 1 prices
(Round your response to the nearest whole number.)
(Round your response to the nearest whole number.)
The GDP deflator in year 1year 1 prices
The GDP deflator in vear?
The percentage change in real GDP from year 1 to year 2 is%. (Round your response to two decimal…
Chapter 2 Solutions
Macroeconomics
Ch. 2 - Prob. 1RQCh. 2 - Prob. 2RQCh. 2 - Prob. 3RQCh. 2 - Prob. 4RQCh. 2 - Prob. 5RQCh. 2 - Prob. 6RQCh. 2 - Prob. 7RQCh. 2 - Prob. 8RQCh. 2 - Prob. 9RQCh. 2 - Prob. 10RQ
Ch. 2 - Prob. 1NPCh. 2 - Prob. 2NPCh. 2 - Prob. 3NPCh. 2 - Prob. 4NPCh. 2 - Prob. 5NPCh. 2 - Prob. 6NPCh. 2 - Prob. 7NPCh. 2 - Prob. 8NPCh. 2 - Prob. 9NPCh. 2 - Prob. 1APCh. 2 - Prob. 2APCh. 2 - Prob. 3APCh. 2 - Prob. 1WWMDCh. 2 - Prob. 2WWMDCh. 2 - Prob. 3WWMDCh. 2 - Prob. 4WWMDCh. 2 - Prob. 5WWMDCh. 2 - Prob. 6WWMD
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