Macroeconomics
13th Edition
ISBN: 9780134744452
Author: PARKIN, Michael
Publisher: Pearson,
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Question
Chapter 6, Problem 7SPA
To determine
Illustrate whether the quantity of labor (aggregate hours) will increase or decrease.
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Homework (Ch 25)
Complete the table by calculating physical capital per worker as well as labor productivity.
Hint: Recall that productivity is defined as the amount of goods and services a worker can produce per hour. In this problem, measure productivity as
the quantity of goods per hour of labor.
Year
2016
2017
Physical Capital Labor Force
(Printing presses)
300
480
Based on your calculations,
productivity from 2016 to 2017.
(Workers)
100
120
Physical Capital per Worker Labor Hours
(Printing presses)
(Hours)
4,000
4,200
Output
(Books)
36,000
50,400
Labor Productivity
(Books per hour of labor)
in physical capital per worker from 2016 to 2017 is associated with
Suppose you're in charge of establishing economic policy for this small island country.
Which of the following policies would lead to greater productivity in the printing industry? Check all that apply.
Subsidizing research and development into new printing technologies
Imposing a tax on printing presses
Encouraging…
Suppose an economy that produces and consumes apples, bread, and toy-cars. In the
following table are data for two different years.
2019 2020
Good Quantity Price Quantity Price
Apples 50 Rs.50 60 Rs.60
Bread 200 Rs. 20 180 Rs.25
Cars 25 Rs. 100 30 Rs.140
a. Using 2019 as the base year, compute the following statistics for 2019 and 2020 in the table
given below:
Statistics 2018 2019
GROSS DOMESTIC PRODUCT
Nominal GDP
Real GDP
GROWTH RATE
Growth Rate of Nominal GDP
Growth Rate of Real GDP
PRICE INDICES
GDP deflator
Inflation rate using GDP deflator -
CPI (a fixed-weight price index)
Inflation rate using CPI
b. How much did the cost of living rise between 2018 and 2019? Compare the answers given by
GDP deflator and CPI. Explain the difference.
c. Explain which price index (GDP deflator or CPI) should be used to adjust the salaries,
budget or spending to counterbalance the changes in the cost of living? Why?
France produces two goods: milk and wheat. Below is a table showing prices and quantities of output for three years:
Year Price of milk
Quantity of milk
Price of wheat
Quantity of wheat
2019
€1
200
€2.9
300
2020
€1.2
250
€3
330
2021
€1.4
280
€3.2
375
The nominal GDP for 2021 is
Assuming 2019 to be the base year, the real GDP for 2021 is
GD deflator for 2021 is
a)
France's Office of National Statistics decides to determine the following representative bundle of goods and services purchased by a typical consumer: 5 milk products and 4 wheat products. The
CPI in 2021 (assume 2019 to be the base year) is
The yearly inflation rate for 2021 is
Chapter 6 Solutions
Macroeconomics
Ch. 6.1 - Prob. 1RQCh. 6.1 - Prob. 2RQCh. 6.1 - Prob. 3RQCh. 6.2 - Prob. 1RQCh. 6.2 - Prob. 2RQCh. 6.2 - Prob. 3RQCh. 6.3 - Prob. 1RQCh. 6.3 - Prob. 2RQCh. 6.3 - Prob. 3RQCh. 6.3 - Prob. 4RQ
Ch. 6.3 - Prob. 5RQCh. 6.3 - Prob. 6RQCh. 6.4 - Prob. 1RQCh. 6.4 - Prob. 2RQCh. 6.4 - Prob. 3RQCh. 6.5 - Prob. 1RQCh. 6.5 - Prob. 2RQCh. 6.5 - Prob. 3RQCh. 6 - Prob. 1SPACh. 6 - Prob. 2SPACh. 6 - Prob. 3SPACh. 6 - Prob. 4SPACh. 6 - Prob. 5SPACh. 6 - Prob. 6SPACh. 6 - Prob. 7SPACh. 6 - Prob. 8SPACh. 6 - Prob. 9APACh. 6 - Prob. 10APACh. 6 - Prob. 11APACh. 6 - Prob. 12APACh. 6 - Prob. 13APACh. 6 - Prob. 14APACh. 6 - Prob. 15APACh. 6 - Prob. 16APACh. 6 - Prob. 17APACh. 6 - Prob. 18APACh. 6 - Prob. 19APACh. 6 - Prob. 20APACh. 6 - Prob. 21APACh. 6 - Prob. 22APACh. 6 - Prob. 23APACh. 6 - Prob. 24APACh. 6 - Prob. 25APA
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- Real Gross Domestic Product (GDPY 2.476 billion US dollars Real income per capita in Lusitania is $ (Round your response to the hearest dollar.) Real income per worker in Lusitania is $ (Round your response to the nearest dollar) The following table gives you the same information for the country Arctica 2011 Population, total in Arctica Employment 120 million 60 million Real Gross Domestic Product (GDP) 3,600 billion US. dollars Real income per capita in Arctica is $ (Round your response to the nearest dollar Real income per worker in Arctica is $ (Round your response to the nearest dollar) Based on the information, V would be considered more productive since its V is higher Using the information given in both of these tables to compare living standards in Lusitania and Arctica you should use O A. the dependency ratio. O B. real income per capita O C. absolute real GDP in U.S. dollars O D. real income per worker. Click to select your answer(s).arrow_forwardChapter 5: Chain-type growth rate, GDP deflator, Consumer Price Index (CPI), and Inflation Product Quantity Price Year 1 Cereal 1,000 $1.00 Beef 700 $2.00 Doughnuts 600 $0.50 Year 2 Cereal 1,400 $1.10 Beef 600 $2.50 Doughnuts 500 $0.75 year 1 is the base year, what is the consumer price index (CPI) in year 2? If year 1 is the base year, what is the inflation rate between year 1 and 2?arrow_forwardThe tables set out information about the economy of Athabasca. Calculate the quantity of labor employed, the real wage rate, and potential GDP. The quantity of labor employed is million hours. Table 1 Production Function Labor hours (millions) 5 10 15 20 25 Table 2 Labor Market Real wage rate (2012 dollars per hour) 20 19 18 17 16 Real GDP (millions of 2012 dollars) 100 195 285 370 450 Quantity of labor demanded Quantity of labor supplied (millions of hours per year) 5 25 10 20 15 15 20 25 10 5arrow_forward
- # 3 E production function in 2018. Real wage rate (dollars per hour) 80 70 60 80 F3 $ 4 R F LL 50 40 30 20 Q Labor hours supplied 45 40 F4 % 5 35 30 25 20 15 5. What are the equilibrium real wage rate, the quantity of labor employed in 2018, labor productivity, and potential GDP in 2018? T G Labor hours. demanded 5 6. In 2019, the population increases and labor hours supplied increase by 10 at each real wage rate. What are the equilibrium real wage rate, labor productivity, and potential GDP in 2019? 0 F5 7. In 2019, the population increases and labor hours supplied increase by 10 at each real wage rate. Does the standard of living in this economy increase in 2019? Explain why or why not. 6 10 c 15 20 F6 25 30 35 Y & 7 ← Labor (hours) F7 5 10 15 20 25 30 35 40 U 8 Page Real GDP (2009 dollars) DII F8 425 800 1,125 1,400 1,625 1,800 1,925 2,000 ( F9 2 F10 > of 3 0 P F11arrow_forwardUse the following table to calculate nominal and real (inflation-adjusted) growth in Country A's GDP per capita. Based on your calculation, which of the following is true? [Select one answer] Year Nominal per capita GDP CPI (price index) Real per capital GDP Year 1 1000 1 1000 Year 2 1500 1.1 1363.64 There is not enough information to calculate the growth rate The nominal growth is 36.36% The nominal growth is 50% The nominal growth rate is 500%arrow_forwardConsider the following data for a hypothetical economy that produces two goods, milk and cheese. Quantity Produced Mak (litres) Cheese (kg) 110 121 Year 1 Year 2 Prices Milk (Slitro) Cheese (S/kg) 6 7 66 3 Using year 1 as the base year, the 53 35% increase in nominal GDP may be explained by a % increase in real GDP and a 1% increase in prices (Round your responses to two decimal places)arrow_forward
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