Unit 3.docx - Chapter 5 Question #1 Why do national income...

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Chapter 5Question #1Why do national income accountants compare the market value of the total outputs invarious years rather than actual physical volumes of production? What problem is posedby any comparison over time of the market values of various total outputs? How is thisproblem resolved?
Question #2Why are only final goods counted in measuring GDP for a particular year? Why is thevalue of used furniture that's bought and sold not counted?
Only final goods are counted in order to avoid the error of multiple counting, and to ensure thatthere is a true reflection of the GDPExplanation:goods are bought and purchased over and over again, and this, if included in the GDP, canincrease the value of GDP, and become misleading. these stages of production can be involving,and that is why only final goods are includedthe value of furniture that is used is not counted, because the value is already determined in itsfirst production. again, they do not reflection the production of current year in the GDP, andcannot be included in this.List two (2) reasons for the economic decline of the Islamic society and discuss eachconcerning their effect on cultural conditions.
Which of the following are included in this year's GDP? Explain your answer in each case.a. The services of a commercial painter in painting the family home.b. An auto dealer's sale of a new car to a nonbusiness customer.c. The money received by Smith when she sells her biology textbook to a used-book buyer.
d. The publication and sale of a new economics textbook.e. A $2 billion increase in business inventories.f. Government purchases of newly produced aircraftIncluded transactions are;b,d,e and fExplanation:

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Term
Fall
Professor
STEVETOBI
Tags
Economics, gross domestic product

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