plugin-PS_2 - Any typo or mistake is on me. Any questions,...

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Any typo or mistake is on me. Any questions, email me. xgu@econ.rutgers.edu 1 Econ 103: Sec.05 Problem Set #2: Due on Tuesday 5 th October 2010 Note: 1. Do it LOL. Do it independently . Do it carefully. 2. Write your answer on the answer sheet attached. I only collect answer sheets on Tuesdays. 3. Good Luck! 1. Statement 1: While GDP includes tangible goods such as books and bug spray, it excludes intangible services such as the services provided by teachers and exterminators. Statement 2: Changes in real GDP reflect only changes in the amounts being produced. a.1 is true; 2 is true. b.1 is true; 2 is false c.1 is false; 2 is true d.1 is false; 2 is false. 2. To compute GDP, we a. add up the wages paid to all workers. b. add up the costs of producing all final goods and services. c. add up the market values of all final goods and services. d. take the difference between the market values of all final goods and services and the costs of producing those final goods and services. 3. Gross domestic product is defined as a. the quantity of all final goods and services demanded within a country in a given period of time. b. the quantity of all final goods and services supplied within a country in a given period of time. c. the market value of all final goods and services produced within a country in a given period of time. d. Both (a) and (b) are correct. 4. Which of the following is not included in GDP? a. carrots grown in your garden and eaten by your family b. carrots purchased at a farmer’s market and eaten by your family c. carrots purchased at a grocery store and eaten by your family d. More than one of the above is not included in GDP. 5. Spots, Inc. produces ink and sells it to Write on Target, which makes pens. The ink produced by Spots, Inc. is called
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Any typo or mistake is on me. Any questions, email me. xgu@econ.rutgers.edu 2 a. an inventory good. b. a transitory good. c. a preliminary good. d. an intermediate good. 6. Anna, a U.S. citizen, works only in Germany. The value she adds to production in Germany is included a. in both German GDP and U.S. GDP. b. in U.S. GDP, but it is not included in German GDP. c. in German GDP, but it is not included in U.S. GDP. d. in neither German GDP nor U.S. GDP. 7. If you buy a burger and fries at your favorite fast food restaurant, a. then neither GDP nor consumption will be affected because you would have eaten at home had you not bought the meal at the restaurant. b. then GDP will be higher, but consumption spending will be unchanged. c. then GDP will be unchanged, but consumption spending will be higher. d. then both GDP and consumption spending will be higher. 8. Goods that go into inventory and are not sold during the current period are a. counted as intermediate goods and so are not included in current period GDP. b. counted in current period GDP only if the firm that produced them sells
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This note was uploaded on 02/08/2011 for the course ECONOMICS 101 taught by Professor June during the Fall '08 term at Rutgers.

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plugin-PS_2 - Any typo or mistake is on me. Any questions,...

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