pes16pset6sol - Principles of Economics W1105.002 Spring...

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Principles of Economics W1105.002 Spring 2016 Prof. Musatti Student Name: _______________________ UNI __________________________ Section Number_____________________ Problem Set 6 Solutions 1 . Read “ The Great GDP Swindle by Joe Stiglitz ( ) and discuss some of GDP’s shortcomings as a measure of output and as a measure of social welfare. See article 2. Not all economic transactions are tallied in a nation’s current GDP. Of the transactions listed below which are counted in the 2015 GDP of the United States? If counted, under what expenditure component are they counted? If not counted, why are they not counted? a. In 2015, Dell sells 200 new computers to Columbia University. b. In 2015, Staples sells 1,000 new reams of paper to Columbia University. c. In 2015, Bob sells 100 shares of IBM and uses the proceeds of the sale to buy 10 acres of land in Montana. d. In 2015, Corcoran sells the last two apartments available at a new condominium built in 2013. e. In 2015, Fred, a Columbia University student, buys the international edition of the Hubbard O’Brien textbook. f. In 2015, Sally buys a vintage care. a. Counted - Investment b. Not counted the sale is not final c. Not counted purchases and sales of financial securities are not counted d. Not counted
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