20092ECON212_PS1

20092ECON212_PS1 - METU Department of Economics ECON 212...

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1/7 METU Spring 2009 Department of Economics ECON 212 Principles of Economics Instructor: İ lhan Can Özen Teaching Assistants: Zeynep Akgül, Gizem Peksar ı , Seren Kaz ı c ı PROBLEM SET # 1 PART A: PROBLEMS Q.1 Suppose the following data apply to the Turkey for the year 2009 (all figures are in billions of TL). Net income of nonfarm unincorporated business and rent 67 Indirect taxes less subsidies 60 Change in inventories 10 Government current expenditures on goods and services 130 Net income of farm operators from farm production 45 Personal consumption expenditures 345 Export of goods and services 133 Interest and miscellaneous investment income 69 Gross fixed capital investment 101 Personal income tax 75 Income generated by BP in Turkey 140 Social Security contributions 50 Total corporation profits before taxes 70 Undistributed corporation profits after taxes 4 Imports of goods and services 170 Government transfer and indirect payments to individuals 80 Wages, salaries and supplementary labor income 463 Capital consumption allowances (Depreciation) 35 Corporate taxes 40 Income generated by Do ğ u ş Holding in Russia 400 Using the information given above, compute the following macroeconomic figures. Assume that the items that are not given above are equal to zero. (Show all your work and formulas) a) GDP from the expenditure approach (at market prices) b) GNP from the expenditure approach (at market prices) c) GNP from the income approach (at market prices) d) National Income e) Personal Income f) Disposable Income
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2/7 Q.2 ECON is a country in which only three final goods are produced: wheat, meat and computer. Information on population, nominal prices and total output for each good in years 2003 and 2009 are given below. 2003 2009 per unit Price ($) Output (in millions) per unit Price ($) Output (in millions) Wheat 4.00 2 6.00 5 Meat 5.50 8 9.00 10 Computer 3.00 11 3.50 13 Note: The population of ECON for years 2003 and 2009 are 15,000 and 20,000; respectively. a) Calculate nominal GDP for 2003. b) Calculate nominal GDP for 2009. c) Calculate real GDP for 2003 and 2009 if the BASE YEAR is 2003. d) Calculate the growth rate of real GDP between 2003 and 2009 (using 2003 prices). e) Has the standard of living increased or decreased since 2003? f) Calculate real GDP for 2003 and 2009 if the BASE YEAR is 2009. g) Calculate the growth rate of real GDP between 2003 and 2009 (using 2003 prices). h) What is the implicit GDP deflator for 2003 and for 2009? ( Use 2003 as the base year.) i) What is the implicit GDP deflator for 2003 and for 2009? (Use 2009 as the base year.) j) By what percent has the price level increased between 2003 and 2009? (Use GDP deflators with base year 2003). k)
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20092ECON212_PS1 - METU Department of Economics ECON 212...

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