1) Answer the following as true, false, or uncertain and justify your answers. a) Even a totally export-oriented county can only sell what it produces; so exports must always be less than or equal to GDP. b) Middle-class families used to have a stay-at-home spouse who cooked and cleaned; now they are likely to have two working adults but go out to eat and hire a cleaning service. The result is a larger GDP, but not necessarily higher true output. c) The growing importance of outsourcing - in which companies pay other companies to perform services such as cleaning, bookkeeping, and so on - increases measured GDP. d) Official measures of GDP understate true growth because they fail to take account of the rising importance of technological improvements in the economy.

1) Answer the following as true, false, or uncertain and justify your answers. a) Even a totally export-oriented county can only sell what it produces; so exports must always be less than or equal to GDP. b) Middle-class families used to have a stay-at-home spouse who cooked and cleaned; now they are likely to have two working adults but go out to eat and hire a cleaning service. The result is a larger GDP, but not necessarily higher true output. c) The growing importance of outsourcing - in which companies pay other companies to perform services such as cleaning, bookkeeping, and so on - increases measured GDP. d) Official measures of GDP understate true growth because they fail to take account of the rising importance of technological improvements in the economy.

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter4: The Aggregate Economy

Section: Chapter Questions

Problem 8E

See similar textbooks

Similar questions

An economy produces final goods and serviceswith a market value of $5,000 billion in a givenyear, but only $4,500 billion worth of goods andservices is sold to domestic or foreign buyers. Isthis nation’s GDP $5,000 billion or $4,500 billion?Explain your answer.
During a federal election campaign, the incumbent argues that he should be re-elected because GDP grew by 12 percent during his four-year term in office. You know that population grew by 4 percent over the period, and that the GDP deflator increased by 6 percent during the past four years. What can you conclude about real GDP per person? O It grew, but by less than 12 percent. O It was unchanged. O It decreased. O It grew by more than 12 percent.
Suppose that there are two individuals in an economy, Person 1 and Person 2. Person 1 buys asecond-hand car from Person 2 for $12,000.10. What is the change in GDP according to the Income Approach here? What is the changeof each person’s contribution to GDP according to the Income Approach? Suppose now instead that an individual was buying $400 of wine from a domestic producer ofwine. Now suppose that this individual decides to import $400 of wine instead.11. What is the change of Consumption (C), Investment (I), Government Spending (G), NetExports (NX), and GDP as calculated by the Expenditure Approach in this example?Finally, now consider the following table:Government Purchases of Goods andServices$58.5Indirect Taxes Less Subsidies $29Personal Income Taxes $41.5Wages and Compensation $165.5Interest on Public Debt $15.5Consumption Expenditure $168.4Exports $90.9Depreciation $33.5Imports $93.3Gross Investment $67.2Net Interest Income $19.0Business Profits Before Taxes $45.512. What is…
Alada Belam Canson Country GDP $10,000 $20,000 $ Tij = 0.001 × [(Y₁ × Yj) / D¡j] Distance from: Alada 100 km 250 km Distance from: Belam If the trade volume between Alada and Canson equals to the trade volume between Alada and Belam, what is the expected GDP for Canson? a. 50,000 b. 25,000 c. 100,000 d. 40,000 100 km 100 km
Assume you have the following data for a hypothetical country for a specific year (in billions of ZAR):Wages and Salaries: R2,500Interest: R300Rent: R200Profits: R1,000Taxes (Indirect Taxes Minus Subsidies): R400Depreciation: R500Given the data above, which of the following methods of calculating Gross Domestic Product (GDP) may beused?A. Expenditure approachB. Income approachC. Product approachD. Trade approach
Which of the following will not effect Potential GDP in Country X? government institutions O the unemployment rate O the amount of capital available technology
According to the figure showing 2020 GDP for selected countries, how much larger (in percentage terms) is America's GDP than: 21.43 14.34 5.08 United China Japan States b. Russia? % larger Copyright © McGraw Hill LLC. Permission required for reproduction or display. GROSS DOMESTIC PRODUCT (in U.S. $ trillion) % larger 3.86 2.87 2.83 1.70 1.27 Germany India Great Britain Russia Mexico Source: Gross Domestic Product 2020. The World Bank Group, March 2021 0.53 Sweden Instructions: Round your responses to the nearest whole number. a. Germany? 0.21 Greece 0.01 Haiti
Need asap please... If the U.S. government wanted to, it could just say that everyone who is unemployed is “employed in the job search” and receiving a paycheck for this “work,” and the government could claim that these government employees are producing “job search services.” Recall that in the official definition of GDP, government purchases(G), do not include transfer payments like unemployment checks and Social Security. -- Would this change in the definition of GDP increase GDP? Would it improve well-being?
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.
What are typical GDP patterns for a high-income economy like the United States in the long run and the short run?
Consider the following table showing the breakdown of GDP (in billions) for China. GDP Category Amount (in billions) Wages and Salaries 1000Consumption 1700Investment 700Depreciation 50Government Expenditure100Taxes 300Exports 50Imports 40Income receipts from rest of the world10Income payment to rest of the world50 What are net exports for China? 4. Suppose that GDP in Japan is 1030 and then grows to 1160 (all numbers in billions)What is the growth rate of GDP in Japan?Use the following information to answer questions 5 through 15: The tables below show data on prices and quantities of Oranges and Shoes produced in China. Data for 2014Price of Oranges Quantity of Oranges Price of Shoes Quantity of Shoes0.7 200 10 270Data for 2015Price of Oranges Quantity of Oranges Price of Shoes Quantity of Shoes0.9 150 14 250Data for 2016Price of Oranges Quantity of Oranges Price of Shoes Quantity of Shoes1.4 300 15 3305. Given this data, what is the Nominal GDP in 2014?6. What is the Nominal GDP in…
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 sells 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.