fer to the following:Real / Nominal GDPGDP CALCULATIONSYear 1 (base year)ResetYear 2PriceQuantityPrice(0-$20)(0-400)ExpenditureQuantity(0-$20)(0-400)ExpenditureA les1.50100$150.00Apples1.50100$150.00IBread1.00200$200.00Bread1.00200$200.00Nominal GDPReal GDPGROWTH RATESNominal GDP (Year 1 to Year 2)0.0%$350.00Nominal GDP$350.00Real GDPReal GDP (Year 1 to Year 2)0.0%$350.00$350.00 oka. Instructions: With the help of the table above, fill in the blanks in the sentence below.kA 10% rise in the price of apples is Click to select) in dollar terms than a 10% rise in the price of bread but has aimpact on nominal GDP growth because it has a (Click to select) weight in the calculation.(Click to select)intb. Instructions: Choose the most appropriate answer from the list below to complete the sentence.rencesAn increase of 20 in the quantity of apples in year 2 willO lead to a larger % increase in real and nominal GDP than an increase of 20 in the quantity of bread because the price ofapples is higher than that of bread.lead to the same % increase in real GDP as an increase of 20 in the quantity of bread but will not change nominal GDP.lead to a smaller % increase in real and nominal GDP than an increase of 20 in the quantity of bread because the quantity ofapples is still smaller than that of bread.Olead to the same % increase in real and nominal GDP as an increase of 20 in the quantity of bread.

It is known as the GDP value at the current or ongoing prices. It cannot be used for comparing GDP…

er to the following: Real / Nominal GDP GDP CALCULATIONS Year 1 (base year) Reset Year 2 Price Quantity Price (0-$20) (0-400) Expenditure Quantity (0-520) (0-400) Expenditure A les 1.50 100 $150.00 Apples 1.50 100 $150.00 Bread 1.00 200 $200.00 Bread 1.00 200 $200.00 Nominal GDP Real GDP $350.00 Nominal GDP $350.00 Real GDP GROWTH RATES Nominal GDP (Year 1 to Year 2) Real GDP (Year 1 to Year 2) 0.0% 0.0% $350.00 $350.00

er to the following: Real / Nominal GDP GDP CALCULATIONS Year 1 (base year) Reset Year 2 Price Quantity Price (0-$20) (0-400) Expenditure Quantity (0-520) (0-400) Expenditure A les 1.50 100 $150.00 Apples 1.50 100 $150.00 Bread 1.00 200 $200.00 Bread 1.00 200 $200.00 Nominal GDP Real GDP $350.00 Nominal GDP $350.00 Real GDP GROWTH RATES Nominal GDP (Year 1 to Year 2) Real GDP (Year 1 to Year 2) 0.0% 0.0% $350.00 $350.00

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter6: Tracking The U.s. Economy

Section: Chapter Questions

Problem 3.6P

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What are the two main difficulties that arise in comparing different comparing GDP?
Year Cost of basket (R) of consumer goods / services Base Year 2018 1850 2019 2190 2020 2380 2021 2560 Use the information in Table to measure the consumer price indexfor 2019, 2020 and 2021 respectively.Show your calculations and round off to two decimal places. Show how gross national product (GNI) can be derived from gross domesticproduct (GDP). Explain, with the aid of an equation, the components of the consumptionfunction.
1. Referring to the figures below, 1.0 gdp-gth 80 BPERMITS-YOY 0.8 60 0.6 - 0.4 40 0.2 20 0.0 -0.2 -20- -0.4 -0.6 -40 rel. vol. = 9.4 --0.8 -60 -1.0 1970 2000 2010 1960 1980 1990 2020 -8 -6 -4 -2 2 4 6. 8. TIME (year) LAG (quarters) Source: FRED/BEA characterize the relationship between the growth rate of GDP and the growth rate of building permits (BPERMITS-YoY) in terms of the following items: • Timing. • Direction. • Volatility. Include a brief description of each item in this list in your characterization. RATE (%/year) CROSS CORRELATION
Complete the table. Real GDP Consumption (C) $6,200 6,850 7,500 8,150 8,800 (Y) $8,000 9,000 10,000 11,000 12,000 Planned Investment (1) $1,500 1,500 1,500 1,500 1,500 Gov't Net Purchases Exports (G) (NX) $1,500 - $500 1,500 - $500 1,500 - $500 1,500 - $500 1,500 - $500 Planned Aggregate Expenditure Inventories $ $ 9,350 10,650 11,300 Unplanned Change in
Compute for GNP using Expenditure, Income, and Valued Added Approach. Personal Consumption Expenditures Rents, Interests, Dividends, Wages 1,100,000 950,000 Government Income 35,000 Indirect Taxes 130,000 Exports of goods and non-factor services Fixed Capital Formation Forestry 650,000 270,000 55,000 Government Services 120,000 Imports of goods and non-factor services Subsidies 640,000 5,000 Trade 280,000 Increase in Stocks Corporate Income Depreciation Allowance General Govemment Consumption Expenditures Net Factor Income from Abroad Agriculture 7,000 60,000 17,000 80,000 20,000 550,000 Real Estate 150,000
Depreciation 200 Exports 150 public transfer 200 Gross domestic private investment 300 corporate income tax 100 factor receipts from abroad 400 gevenment expenditure on goods and services 250 interest income 800 compensation of employees 2600 net interest on government debit 50 indirect business taxes 100 factor payments to abroad 200 imports 200 proprietors incom(profits) 700 retained corporate profit 200 personal consumption expenditure 4500 personal taxes 100 social security contribution 50 rental income 600. From the above data find personale disposable income.
стор 0 The goverment report that (GDP) Increased by 1.6 6 1.6 percent in the last quater. This statement means that GOP Increased @by 6.4 percent for the year (6) rate of 6.4 percent 1 at an annual rate of 6.4 during last quater Ⓒ) at an annual rate of 1.6 during the las quater d at an annual rate of 4 4 percent during the last quater.
The equilibrium level of real GDP is Real GDP Consumption (Y) (C) $8,000 $6,200 9,000 10,000 11,000 12,000 6,850 7,500 8,150 8,800 Planned. Gov't Net Investment Purchases Exports Aggregate Planned (1) $1,675 (G) (NX) $1,675 -$500 Expenditure $9,050 1,675 1,675 -$500 9,700 1,675 1,675 -$500 1,675 -$500 1,675 -$500 1,675 1,675 10,350 11,000 11,650 Unplanned Change in Inventories $-1,050 -700 -350 350
Suppose a closed economy has a national income of $260 milion. $535 midon in private savings, $200 millon worth of tax evenue, and $150 milion in govemment spenting what is the consumprion expenditure in this economy? Os125 milion Os155 milion OS385 mition Ossa5 milion OS645 milion
Year Cost of a basket (R) of consumer goods/services (Base year ) 2015 1850 2016 2190 2017 2380 2018 2560 Use the information in Table 3 to measure the consumer price index for 2016, 2017 and 2018 respectively. Show your calculations and round off to two decimal places. Show how gross national product (GNI) can be derived from gross domestic product (GDP). Explain, with the aid of an equation, the components of the consumption function. Explain the relationship between Investment spending and the interest rate.
For each of the following transactions, determine the contribution to the currentyear’s GDP.a) On January 1, you buy 10 gallons of petrol at GHC 15 per gallon. The fillingstation purchased the petrol the previous week at wholesale price of GHC 12per gallon.b) You purchased a locally manufactured AK 47 used in the 2nd world war duringan exhibition for GHC 2million. The brokerage fee was 6% of the sale value.c) A homemaker enters the work force, taking a job that pays GHC 40,000 a year.The homemaker now hires a nanny who is paid GHC 16,000 per year.d) You are informed that you have won a lottery worth GHC 3million to be paidto you immediately.e) You are informed that you have won a lottery worth GHC 3million to be paidto you immediately. In addition, the GNL pays you GHC 5000 to appear intheir promotional advert.f) Busy internet replaces all its stock of all computers with brand new locallymanufactured computers from rLg worth GHC 100m. It sells its old computersfor GHC 40million to rLg…
e the information in the table to answer the folowing qustiona. Al numbers are in bilions of 2012 dolars Govermment Purchases (G) $2.00 $2.500 $2.500 $2.500 $2.500 Pianned investment ( $1.000 Net Exports (NK) Real GOP (Y) Consumption (C) $12.000 $13.000 $14,000 $15.000 $10.000 $9.500 $10.250 $1.000 -$500 -$500 -5500 -$500 -$500 $1.000 $1,000 S11,750 $1.000 $12.500 $1.000 The equibrum level of GOP is S bilion The MPC is (snter your reaponse to two decimal places) Suppose that net exporta increase by $200 blion. Using the multiplier formua, determine the new level of GOP. AS200 bilon increase in net exports leads to a change in spending of S bilion, so the new level of GDP wi be billon