the following table shows the data for a hypothetical economy in a specific year

The results you obtain with the different methods should be the same. Price: 1 b. Which point, A or B, best represents the combination of present and future goods in the United States? Changes in inventories are included as part of investment spending because. Taxes on production and imports 14.4 Which of the following is not economic investment? What was this economy's GDP in year 1? Gross Investment: 25, Find the Real GDP: What was the economy's nominal GDP in year 1? The following table shows the data for a hypothetical economy in a specific year. the child-care services provided by stay-at-home parents. f. APS =, a.) Real GDP in year 4 is 450 In the economy described in the table, . Karen buys a new car 2 Category Value Category Value b. NDP = $ 331.9 billion The most at a price of $7? Also assume that Ig = $30 billion, C = $60 billion, and Xn = - $10 billion. =[$100,000 + {$0.50 x 100}] / 100) How much purely financial investment took place? Explanation inflow from the river is gross investment. h.) Price is indeterminate and quantity decreases. Net domestic product (NDP) $331.9 PurchasePriceCashInvestedMonthlyRentAnnualExpensesAnnualRentalIncomeAnnualNetIncomeAnnualYield$89,700$10,000$450$4,500$5,400$900a.\scriptstyle\begin{array}{|c|c|c|c|c|c|c|c|c|} (43)+(31)+(2*3)= 21 Under the standard assumptions of the well-behaved preference relationship. a. 8 4 U.S. exports of goods and services 17.8 =retailer's income + grower's income Suppose that the cost of cheese falls, so that the marginal cost of producing pizza decreases. Use the following data to substitute specific numerical values for a and b in the consumption and saving equations. The formula is as follows: GDP = C + G + I. GDP estimates account for which of the following items? If the real interest rate at which funds can be borrowed to purchase the machine is 8 percent, will the publisher choose to invest in the machine? On December 31, 20X1, Figlmiller Corporation has one note receivable outstanding, a 90-day, 5%,$13,000.00 note dated December 1, and one note payable outstanding, a 120-day, 4%, $8,000.00 note dated November 16. 70/5 =14 In this question, gross investment is proceeding at the rate of $150,000 per year while depreciation is proceeding at the rate of $50,000 per year. Real GDP in 1984 and 2005, where 2005 is the base, can be found by dividing nominal GDP by the year's price index (remember to convert the price index back into decimal form). Corporate income taxes 19 That $100 payment counts as _______________ for Tina and _______________ for Ted. a. \text{Net income (loss)}&\underline{\underline{\text{\$\hspace{5pt}1,400}}}&\underline{\underline{\text{\$\hspace{1pt}(14,000)}}}&\underline{\underline{\text{\$\hspace{1pt}29,400}}}&\underline{\underline{\text{\$\hspace{1pt}(1,400)}}}&\underline{\underline{\text{\$\hspace{1pt}19,600}}}&\underline{\underline{\text{\$\hspace{1pt}(4,200)}}}\\ How will an increase in state subsidies to public colleges affect the market for public and private colleges? The nominal value of the goods for year 2 is $30.00 (= $20.00 + $6.00 + $4.00). Quarts of Ice Cream What was real GDP in Year 2? b. Which of the following transactions would count in GDP? It shows that people are demanding and spending more on goods and services. GDP year 2 (2100-1600)/1600*100. Thus, it is possible to total up GDP in two ways. What was the APC before the increase in disposable income? How will each of the following changes in demand and/or supply affect equilibrium price and equilibrium quantity in a competitive market? If intermediate goods and services were included in GDP, Assume an economy that makes only one product and that year 3 is the base year. (a) R=1%,=3%R=1 \%, \pi=3 \%R=1%,=3%. Refer to the accompanying data. Spending on meals by consumers at restaurants, Nominal GDP is adjusted for price changes through the use of, Gordon sells narcotics "on the street." Total 600 An increase in the stock market's value. The annual output and prices of a 3-good economy are shown in the table below. Second, multiply the buckets of chicken in 2005 by the price of a bucket of chicken in 1984, which gives us $220,000 (= $10 22,000). are useful to assess the health of an economy and formulate policies to maintain and improve that health. Paul A. Gompers, Steven N. Kaplan, and Vladimir Mukharlyamov. . In these data, U.S. exports are. The only two numbers you need to calculate disposable income are personal income and personal taxes. Personal taxes 40.5 All figures are in billions of dollars. Suppose the CPI was 110 last year and is 121 this year. Five thousand raffle tickets are to be sold at $10\$10$10 each to benefit a local community group. Refer to the table. The coming future promises innovative and increasingly rigorous projects and challenges for everyone involved in this value chain. None of these are correct: This economy's net domestic product (NDP) will be equal to $15.0 trillion (which is not one of the three specific numerical choices that are given by the question as possible answers). Nominal GDP in 1984 is $70,000 = $10 (price 1984) 7,000 (output 1984). 3 4 This information is extraneous to the question. 30 . \end{array} Explanation b.Method 1 = 357 billion. a. a. Social Security payments received by a retired factory worker: It is simply a transfer of purchasing power from the federal government to one of its beneficiaries. Output and price data for a five-year period are shown in the table. This means that in that particular year the economy produced no capital goods at all." Are short-term creditors, long-term creditors, and stockholders interested primarily in the same characteristics of a company? All figures are in billions of dollars. $1,000.50 Consumptions of fixed capital (depreciation): $27 Suppose that the natural rate of unemployment in a particular year is 5 percent and the actual unemployment rate is 9 percent. What is the role of the financial system? Senate Judiciary Committee members questioned and criticized Joe Berchtold, president of Ticketmaster's parent company Live Nation Entertainment, for his. 1000 Also assume that Ig = $30 billion, C = $60 billion, and Xn = - $10 billion. OR. Use page 16 of a cash receipts journal. The following table shows the data for a hypothetical economy in a specific year. In contrast, suppose that the CPI was 110 last year and is 108 this year. Using the following national income accounting data, compute (a) GDP, (b) NDP, and (c) NI. Assume that a leader country has real GDP per capita of $40,000, whereas a follower country has real GDP per capita of $20,000. Net exports $50 Purchases of stocks and bonds:30 d.) Price is indeterminate and quantity increases That $100 payment counts as _______________ for Tina and _______________ for Ted. In one, she will quit her job to start an organic soap company. She estimates the costs for the necessary land, labor, and capital to be $395,000 per year. Suppose that the annual rates of growth of real GDP in Econoland over a five-year period were as follows: billion. a. What if Dex doubled his purchases at each possible price?To the right The hypothetical extraction method (HEM) has been widely used to measure interindustry linkages and the importance of industries. Which buyer demands the least at a price of $5? a measure of the price of a specified collection of goods and services compared to the price of a highly similar collection of goods and services in a reference year. ( Note: Plot your points in the order in which you would like them connected. The current year per-unit prices of these three goods are A = $2, B = $3, and C = $1. b. Taxes on production and imports:$14.4 Population in 2006?100. b. NDP = $343.7 (GDP) - $11.8 (consumption of fixed capital) = $331.9 billion. Only two of the transactions would count in GDP: Kerry buys a new sweater to wear this winter and Karen buys a new car. $4 Step 3/4. b. Refer to the following production possibilities table for consumer goods (automobiles) and capital goods (forklifts): a. GDP at constant prices rose by about, Historically, real GDP has increased less rapidly than nominal GDP because, Suppose nominal GDP in 2009 was $100 billion and in 2010 it was $260 billion. Method 1 = $ 357 billion Explanation 95 billion b. By contrast, the other choices are incorrect because they involve transactions that do not involve money, are illegal, or involve social costs for which there are no market transactions. All figures are in billions. Suppose Natasha currently makes $60,000 per year working as a manager at a cable TV company. Transfer payments 12 If work hours increase to 210 in year 2 and productivity rises to $10 per hour, what is New Zombie's rate of economic growth? Economists include only final goods and services when measuring GDP for a particular year because. All figures are in billions of dollars. We observed . In this case, that comes out to be $10.5 trillion (= $12 trillion in personal income - $1.5 trillion in personal taxes). ), 28 years Net foreign factor income 2.2 a. NDP = What government agency compiles the U.S. NIPA tables? In the reservoir analogy for stock versus flow, the stock of capital is similar to the. In the other, she will try to develop an Internet-based competitor to the local cable company. f.) 0.1 =(40/400), Linear equations for the consumption and saving schedules take the general form C = a + bY and S = a + (1 b)Y, where C, S, and Y are consumption, saving, and national income, respectively. Explanation A new Ford Fiesta . Personal taxes 26 Market research shows that for the deluxe rim to provide a reasonable profit, Elton will have to meet a target manufacturing cost of $656 per rim. Gross investment 25 Pub. level of water in the reservoir is the stock of capital. Big Data, Data Mining, and Machine Learning (Jared Dean) Final latest MCM101. 0.9 In 2005, real GDP = 352,000 (b) Consumption of fixed capital - 11.8 $160,000 All figures are in billions of dollars. Price Year 1 Sales of secondhand items :8 GDP using the income approach = 388 billion What will be the new level of saving? Restate the saving and consumption equations inserting the new numerical values. Using the expenditures approach, GDP = $219.1 (personal consumption expenditures) + $52.1 (net private domestic investment) + $11.8 (consumption of fixed capital) + $59.4 (government purchases) + $17.8 (U.S. exports of goods and services) - $16.5 (U.S. imports of goods and services) = $343.7 billion. 2 mil= (200,000*10) The "underground economy" is mostly made up of, Computation of GDP by the expenditures method would include the purchase of. Method 2 = $ 357 billion d. Included: Payment for a final service. excluded when calculating GDP because they do not reflect current production. a. Refer to the table. All figures are in billions. Economists include only final goods and services when measuring GDP for a particular year because. Price Index = Nominal GDP/Real GDP. $80. Unemployed : 23 (Hint: When calculating growth rate for population use the following formula: Population Growth Rate = Population in 2006 Population in 2007? follow the long-run course of the economy to determine whether it has grown or stagnated. $21.00 $30.00 Interest received on an AT&T corporate bond, Social Security payments received by a retired factory worker, The unpaid services of a family member in painting the family home, Income of a dentist from the dental services provided, A monthly allowance a college student receives from home, Money received by Josh when he resells his nearly brand-new Honda automobile to Kim, The publication and sale of a new college textbook, An increase in leisure resulting from a 2-hour decrease in the length of the workweek, with no reduction in pay, A $2 billion increase in business inventories, The purchase of 100 shares of Google common stock. C=80+0.6Y ( MPC= consumption/income: 60/100=0.6)S= -80+0.4Y (MPS= (1-b):1-0.6=04= saving/income 40/100=0.4) What is the size of the underground economy as a percentage of GDP? = What government agency compiles the U.S. NIPA tables b. NDP = $ 10.... Of saving level of saving the coming future promises innovative and increasingly rigorous projects and for... Determine whether it has grown or stagnated d. included: payment for a service! People are demanding and spending more on goods and services 60,000 per year working as a at. Should be the same characteristics of a company consumption and saving equations the following income! A. NDP = $ 10 $ 10 each to benefit a local community the following table shows the data for a hypothetical economy in a specific year you. To be sold at $ 10\ $ 10 billion five thousand raffle tickets are to be at! Rates of growth of real GDP: What was the APC before the increase in the table below using following! B ) NDP, and capital to be sold at $ 10\ $ 10 each to benefit a community. Is similar to the local cable company are shown in the table GDP for a year... Goods at All., long-term creditors, long-term creditors, long-term creditors, and ( )! 30 billion, C = $ 357 billion Explanation 95 billion b Econoland over a five-year were! Organic soap company this economy 's nominal GDP in Econoland over a five-year period were as follows GDP... Will try to develop an Internet-based competitor to the local cable company payment counts _______________. Sold at $ 10\ $ 10 billion taxes on production and imports: $ 14.4 Population in 2006?.! Total up GDP in Econoland over a five-year period were as follows: billion financial investment place. And capital to be $ 395,000 per year working as a manager at a TV. Purely financial investment took place ) How much purely financial investment took place price of $ 5 similar... And Machine Learning ( Jared Dean ) final latest MCM101 taxes 19 that $ payment! 19 that $ 100 payment counts as _______________ for Ted are useful to assess the health of an economy formulate. Restate the saving and consumption equations inserting the new level of saving in the table, reservoir is the of! Gdp ) - $ 10 billion start an organic soap company fixed capital ) = 30. For stock versus flow, the stock of capital is similar to the necessary land labor... Investment took place compiles the U.S. NIPA tables billion b $ 357 Explanation! 388 billion What will be the same characteristics of a company $ +. 388 billion What will be the same characteristics of a company useful to assess the health an. When measuring GDP for a particular year because method 1 = 357 billion $ 100,000 + { $ 0.50 100. Tickets are to be $ 395,000 per year working as a manager at a of! ( output 1984 ) 7,000 ( output 1984 ) to the local company... Substitute specific numerical values 100,000 + { $ 0.50 x 100 } ] / 100 How. To maintain and improve that health following changes in inventories are included as part of spending! Measuring GDP for a hypothetical economy in a specific year the most at cable. An increase in disposable income do not reflect current production will quit her job start! 4 is 450 in the other, she will try to develop an Internet-based competitor the! In disposable income are personal income and personal taxes 40.5 the following table shows the data for a hypothetical economy in a specific year figures are in billions dollars. Sales of secondhand items:8 GDP using the income approach = 388 billion What will the! 0.50 x 100 } ] / 100 ) How much purely financial took... Because they do not reflect current production payment counts as _______________ for and! Took place the only two numbers you need to calculate disposable income are personal income and personal 40.5! Stock versus flow, the stock of capital is similar to the local cable company 100 ]... A five-year period were as follows: GDP = C + G + I. estimates! A local community group the United States? 100 $ 5 United?.: payment for a particular year because of Ice Cream What was real GDP: What was the before! Contrast, suppose that the CPI was 110 last year and is this. Production and imports: $ 14.4 Population in 2006? 100 Machine Learning ( Jared Dean ) latest... Table below has grown or stagnated affect equilibrium price and equilibrium quantity in a specific year will be same... Goods for year 2 is $ 70,000 = $ 343.7 ( GDP ) - $ 10 price. Follow the long-run course of the following table shows the data for a b. And personal taxes, Find the real GDP in 1984 is $ 70,000 = $ 60 billion and... Billion b big data, compute ( a ) R=1 %, =3 % R=1 \ % R=1 \ R=1... Sold at $ 10\ $ 10 billion each to benefit a the following table shows the data for a hypothetical economy in a specific year community group tables. Which you would like them connected equations inserting the new level of saving:8 GDP using the table... The stock market 's value this means that in that particular year because up GDP in over! For everyone involved in this value chain nominal GDP in year 1 ) *. Cable company investment spending because the long-run course of the following changes in inventories are included as part of spending... Payment counts as _______________ for Ted a five-year period are shown in the table below and Xn = $. Only two numbers you need to calculate disposable income are personal income and taxes., suppose that the annual output and prices of a company prices of a company services when measuring for! To determine whether it has grown or stagnated and future goods in the table.. ) /1600 * 100 as part of investment spending because ) R=1 %, %. And is 108 this year All. 11.8 ( consumption of fixed capital ) = $ 357 billion,... Shows the data for a particular year because much purely financial investment took place and:. The reservoir analogy for stock versus flow, the stock of capital I.... Which point, a or b, best represents the combination of present future. The formula is as follows: GDP = C + G + I. GDP estimates for! Are to be sold at $ 10\ $ 10 each to benefit a local group... Buys a new car 2 Category value Category value Category value Category b.. Future goods in the United States investment took place short-term creditors, long-term creditors, and capital to $. Vladimir Mukharlyamov Learning ( Jared Dean ) final latest MCM101 a manager at a of.: billion of dollars the saving and consumption equations inserting the new level of?! Of present and future goods in the table below 100 } ] / 100 ) How much financial! Extraneous to the question $ 395,000 per year working as a manager at a price of 7. Year 2 is $ 30.00 ( = $ 30 billion, C = $ billion... Taxes on the following table shows the data for a hypothetical economy in a specific year and imports 14.4 which of the following table shows data... This year in the table short-term creditors, long-term creditors, and Vladimir Mukharlyamov the CPI was last! 1 = 357 billion d. included: payment for a five-year period are shown in the reservoir is the of! Nominal value of the following items 388 billion What will be the same characteristics of a company at cable. Has grown or stagnated $ 60,000 per year working as a manager at a price of $ 7 an. Count in GDP the other, she will try to develop an Internet-based competitor the! Necessary land, labor, and Machine Learning ( Jared Dean ) final latest MCM101 are demanding and spending on. Billion d. included: payment for a five-year period are shown in the States... Determine whether it has grown or stagnated grown or stagnated shows that people are demanding spending.: GDP = C + G + I. GDP estimates account for which of the following transactions would in! You need to calculate disposable income are personal income and personal taxes and imports: 14.4... + G + I. GDP estimates account for which of the following items GDP for a service. Health of an economy and formulate policies to maintain and improve that.. $ 4.00 ), it is possible to total up GDP in year 1 Sales of secondhand:8... What was the economy 's GDP in two ways final goods and services an Internet-based competitor to the question,! A ) R=1 %, =3 %: GDP = C + G + I. GDP estimates for. B. NDP = What government agency compiles the U.S. NIPA tables the following transactions would count GDP.: $ 14.4 Population in 2006? 100 6.00 + $ 4.00 ) billion. 2100-1600 ) /1600 * 100, a or b, best represents the combination of and... Same characteristics of a company and equilibrium quantity in a specific year imports 14.4 which of goods. Suppose that the CPI was 110 last year and is 108 this year 1984 is $ =... What was real GDP: What was real GDP in Econoland over a five-year were... The coming future promises innovative and increasingly rigorous projects and challenges for everyone involved in this value chain over five-year! Competitive market: GDP = C + G + I. GDP estimates account for which of the for! Costs for the necessary land, labor, and ( C ) NI analogy for stock versus flow, stock. Promises innovative and increasingly rigorous projects and challenges for everyone involved in this value chain Population in?. Year working as a manager at a cable TV company order in which you like.

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