Answer2 - Homework 2 Answer key 15: ACDEE 610: CEBBB 1115:...

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Unformatted text preview: Homework 2 Answer key 15: ACDEE 610: CEBBB 1115: ECDDD 1620: BBADC 2125: AADBA 2630: BBDBB 3135: CBCDB 3640: CCDBB 41. a. b. c. d. e. f. g. 42. The key to this problem is to find the four components of expenditure: a. Consumption expenditures are 1000. These already include household purchases of durable goods, so those would not be counted again. b. Investment expenditures are 395. This is the sum of residential construction (125) plus business fixed investment (250) plus inventory investment (change in stocks over the year, or 20). Sales of existing homes and apartments are not counted in investment or GDP. c. Government purchases are 300. Government payments to retirees are transfers and are not counted. d. Net exports are 35. Net exports equals exports (125) minus imports (90). GDP is the sum of the four components: 1000 + 395 + 300 + 35 = 1730. No it was produced in 1990, not the current year. No stock represents ownership, not production. No it is an intermediate good. Yes. No there was no market transaction. Yes. No there was no market transaction 43. 1996 = (130 120)/120 = 8.3% 1997 = (138 130)/130 = 6.2% 1998 = (144 138)/138 = 4.3% 1999 = (147 144)/144 = 2.1% 2000 = (150 147)/147 = 2.0% Question 1 40 : 2 points each Question 41: 1 point for each item. 7 points in total. Question 42: 2 points for each component of expenditure. 8 points in total. Question 43: 1 point for each right number. 5 points in total. Total Score of this homework: 80+7+8+5=100 points ...
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