MACRO REVIEW_1 - 1 Measuring National Output a What is the...

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1. Measuring National Output a. What is the equation used for GDP and what does each part mean? b. Why are only final goods and services counted in GDP? c. Why are Net Exports currently negative? What are current net exports in the US? d. Which of the following are counted in GDP? i. Purchase of $5,000 of NEXTEL stock ii. A $5,000 lawyer payment made for defending your reckless DUI charge iii. An safety-conscious parent spending $5000 on a used 1994 Volvo iv. A wealthy Economics student spends $5000 on a Japanese Plasma TV v. An American woman makes $5000 working in Scotland vi. A retired seamstress receives a $5000 Social Security payment 2. Unemployment and Inflation a. How does inflation hurt people on fixed incomes? b. What does a price level of 120 mean (using CPI for calculation)? c. What are the two persistent types of unemployment that seem to always exist, even during full employment? What is a simple definition for each type of unemployment?
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