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Problem Set 1

# Problem Set 1 - PROBLEM SET#1 EC202 FALL 2010(INSTRUCTOR...

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P ROBLEM S ET #1 EC202 – F ALL 2010 (I NSTRUCTOR : O LIVETTI ) Due Friday, October 1 st (in class) ****************************************** S ECTION 1 – M ULTIPLE C HOICE , 30 POINTS TOTAL ****************************************** Questions 1-10 Are Based On Chapter 2 [10 Points, 1 Point For Each Question] Please answer Question 1 to 5 based on the entries in Table 2.2: Table 2.2 Category of Expenditure Trillions of \$ Durable Goods 1.1 Fixed Investment 1.0 Federal Government Purchases 0.9 Exports 1.3 Nondurable Goods 2.6 Nonresidential Structures 1.3 State and Local Government 1.5 Imports 2.0 Services 5.2 Residential Structures 0.8 Changes in Business Inventories 2.0 1. Based on the data in Table 2.2, personal consumption expenditure is: a . \$3.7 trillion. c . \$8.9 trillion. b . \$9.7 trillion. d . none of the above. 2. Based on the data in Table 2.2, gross private investment is: a . \$1.0 trillion. c . \$5.1 trillion. b . \$4.3 trillion. d . none of the above. 3. Based on the data in Table 2.2, government purchases are: a . \$0.9 trillion. c . \$0.6 trillion. b . \$2.4 trillion. d . none of the above.

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4. Based on the data in Table 2.2, net exports of goods and services are: a . \$0.7 trillion. c . -\$0.7 trillion. b . \$3.3 trillion. d . none of the above. 5. Based on the data in Table 2.2, gross domestic product is: a . \$17.7 trillion. c . \$19.7 trillion. b . \$15.7 trillion. d . none of the above. Please answer Question 6 to 10 based on the entries in Table 2.4: Table 2.4 Type of Product or Income Trillions of \$ Gross domestic product (GDP) 12.5 Income receipts from the rest of the world 0.5 Depreciation of the capital stock 1.6 Corporate profits, taxes on production, contributions for social insurance, net interest, business transfers, surplus of government enterprises 3.6 Personal taxes 1.2 Income payments to the rest of the world 0.4 Personal income receipts on assets and personal transfer payments 3.0 6. Base on the data in Table 2.4, gross national product (GNP) is: a . \$11.4 trillion. c . \$12.5 trillion. b . \$12.6. trillion. d . none of the above. 7. Based on the data in Table 2.4, net national product is: a . \$11.0 trillion. c . \$12.6 trillion. b . \$11.4 trillion. d . none of the above. 8. Based on the data in Table 2.4, national income is: a .
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