hw 11 - leExerciseH Exercise Score: 1. OF 1. pt Assignment...

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Unformatted text preview: leExerciseH Exercise Score: 1. OF 1. pt Assignment Score: 1.00% (20 0F 20 pts] 2|} 0F 2|} complete [Related to the Chapter Opener] Macroeconomic conditions affect the decisions firms and families make. Why would a recent college graduate tend enter the job market during economic expansion and pursue an advanced degree dining recessionary periods”? It depends on the person; production and employment are unaffected by alternating business cycles. Tui'ton rates tend to fall during recessions. Production and employment decrease during economic expansion and incease during economic recession. V Production and employment increase dmmg economic expansion and decrease dining economic recession. 1eExereieel-4 [JD Exercise Score: 1. OF 1 pt Assignment Score: 1.00% [20 0F 20 pts] 20 of 20 complete Please indicate whether the value of the followmg transactions would be included (as a final good) in the calculation of Gross Domestic Product (GDP). a. The government purchases new airplanes from Boeing. Included in GDP b. The New York Times purchases newsprint from a paper supplier. Not included in GDP . c. You purchase 1000 shares of Microsoft stock. Not included in GDP . d. The broker you use to place the order charges you $35.00 as a fee. Included in GDP leExereiselfi [gr] Exercise 5cere: 1 er 1 pt Assignment 5cere: most: (20 0F 2o ptsj 20 of no complete Cotton is produced and sold as a component in the production of shirts. [s the production of cotton included in GDP? No. There is no value added in the production of cotton. Therefore, its production is not included in the value added method of measuring GDP. V Yes. The value ofthe cotton is not directly counted in GDP. but the production of cotton is included in the value added method of measuring GDP Yes. Both final goods and intermediate goods are included in the calculation of GDP. No. The production of intermediate goods is not included in the calculation of GDP. ieExeroisei? I:J:I Exercise Score: 1. 0F 1. pt Assignment Score: 1.00% [20 0F 20 pts] 2|} of 2|} complete [Related to Solved Problem #1] Suppose that a simple economy produces only the following four goods and services: textbooks, hamburgers, shirts and cotton. Assume that all ofdle cotton is used in the production of shirts. Use the information in the following table to calculate nominal GDP for 2006. Production and Price Statistics for 2006 Product lQuantity.r Price Textbooks 100 $65.00 Hamburgers 100 2.25 Shirts 50 50.00 Cotton 8,000 0.60 Nominal GDPJWfi = $ 9225 (Enter your response as a whole number). 19ExerciseiB {J} Exercise Score: 1. of 1. pt Assignment Score: 1.00% (20 of 20 pts] 20 of 2|} complete [Related to Don't Let This Happen To Youi] From a macroeconomic perspective, when people purchase existing shares of stock, investment spending does not increase. Why? Stock purchases are transfers of ownership and don't result in the production of new goods. Investment refers to the purchase of machinery, factories, and houses. Purchasing existing shares of stock will not increase future productivity the way new machinery will. Answers A and B are correct. V All of the above are correct. x ‘\ x ‘\ x a x x ‘\ x cement Exercise Score: 1 oF 1. pt Assignment Score: 1.00% (20 oF 20 ptfi] 20 of 20 complete Problem 1.12, [Related to Solved Problem #1 ] Suppose that a simple economy produces only the following four goods and services: textbooks, hamburgers, shirts, and cotton. Further, assume that of! of the cotton is used in the production of shirts. Use the information in the following table to calculate Nominal Gross Domestic Product {NGDP} for 2011. PROBE—€110)— [LTD PRICE STATISTICS FOR 2011 Product Quantity Price Textbooks 100 $60.00 Hamburgers 100 2.00 Shirts 50 25.00 Cotton 8 0-00 0.00 a The NGDP for the year 2011 is $ 7450 . lEEKEI'CiS-EZE Exercise Score: 1. OF 1. pt Assignment Score: 1.00% (20 0F 20 pts) 20 of 2|} complete 1Which of the following is likely to increase the measured level of GDP? "he number of people who stay home and raise families decreases. V "he federal government approves a new program to clean western water supplies. She federal government increases tax rates. ceteris panhus. _'here is an increase in purchases made in the underground economy. 1931430392- |:J:| Exercise Score: 1. OF 1. pt Assignment Score: 1.00% (20 0F 20 pts) 20‘ of 20‘ complete A report of me World Bank, an international organization devoted to increasing economic growth in developing countties. includes the following statement: "Informal economic activities pose a particular measurement problem [in calculating GDP], especially in developing countries. where much economic activity may go unrec orded." \R—‘hy does participation in me "informal sector" make GDP measurement cumbersome”? The informa. sector generally uses a variety of measurements that are difficult to compile in to one value for GDP. V "The informa. sector is also known as the Imdergrolmd economy which is not included in GDP. :he informa. sector occurs only in developing countires where acces to data is more difficult to obtain. :he informa. sector includes government transfer payments and financial sectn’ilies that are not included in GDP. Since GDP per capita is often used as a general measure of a society's well-being a large informal sector will make this evaluation process less precise 1eExereise31 I:J:I Exercise Score: 1. OF 1. pt Assignment Score: 1.00% (20 0F 20 rats] 20 of 20 complete [Related to Solved Problem #2] Suppose that a simple econom}r produces onl}r the following four goods and services: textbooks, hamburgers, shirts, and cotton. 2000 Statistics 2006 Statistics 2007 Statistics Product Quantity.r Price Quantity Price Quantity Price Tendbooks 90 $50.00 100 $60.00 150 $60.00 Hamburgers ?'5 2.00 105 2.25 140 2.?5 Shirts 50 30.00 45 20.00 1’0 35.00 Cotton 10,000 0.80 9,000 0.60 12,000 0.?0 a. If2000 is the base year, what is real GDP in 2006? Assume that all cotton is used to produce shirts" $9,330.00 v $0,500.00 $0,150.00 $11 50.25 b. What is real GDP in 200T? Assume that all cotton is used to produce jeans. V $9,330.00 $0,500.00 $0,150.00 $11,335.00 c. What is the growth rate of real GDP dining 200?? + 50.61 93 (Enter as a percentage rounded to two decimal places). 1eExercise32 Exercise Score: 1. OF 1. pt Assignment Score: 1.00% (20 0F 20 Fits] 2|} of 20 complete Australla Him! “'5” A Standard of Living Measures 93 China $5,003 0-75 Human Development Index HDI Greece $19,954 0.91 ' Iran $6,995 0.74 Norway $37,670 0.95 Singapore $24,481 0.91 South Korea $17,971 0.90 United Arab Emirates $22,420 0.05 United States $31,550 0.941- Using the data in the above table, use the point drawing tool to plot and label this data for each countrj.r listed (A uslraiia, Greece, Singapore, 5’. Korea and the US. have already been plotted) You ma}.r round GDP data to the nearest thousand. ' : 522,52“) 53mm U.E-U_Il'i|ilii:|'i'i 'IIIFI 0 10.000 20.000 30.000 40,000 Real GDP perPerson Which countr}r seems to be an outlier with respect to a matching between Real GDP per—person and the HIDI? UAE n 1eExereise3-4 I:J:I Exercise Score: 1 0F 1. pt Assignment Score: 1.00% (20 0F 20 1:113] 20 of ID complete Complete the following statement where 2000 is the base year: If the quantity of final goods and services produced in 2006 decreases, real GDP wifl increase if V Real GDP will not increase. price level in 2000 is much higher than in 2006. price level in 2006 is much lower than in 2000. price level in 2005 is much higher than in 20-00. 1eExerci5035 Exercise Score: 1 OF 1. pt Assignment Score: 100% (20 0F 20 1:13] 20 of 20 complete Using the table, calculate the GDP deflator for each year. Nominal GDP Real GDP GDP Year [0, trillions] [5, trillions] Deflator 2000 $9,800 $9,300 100 2001 $10,100 $9,305 103 2002 $10,400 $10,000 104 2003 $10,900 $10,235 105 2004 $11,100 $10332 109 In which year between 2001 and 2004- did the largest percentage increase in the price level take plac e? 2001 (enfer a yearly value: 2000, 200], 2002, 2004). 1eExereiseEE {J} Exercise Score: 1. OF 1. pt Assignment Score: 1.00% (20 0F 20 p15] 20:11:20 complete Which of the following statements is a possible reason why a cotmlry might have the highest (lowest) level of measured real GDP per capita, but not the highest (lowest) Human Development Index (EDI) value”? Real GDP does not account for changing social conditions or the value of leisure time. HDI is a broader measure; real GDP does not account for changing social conditions. HIDI is a broader measure that inchldes life expectancy at birth and adult literacy. V All of the above are possible explanations. leExertise-41 Exercise Score: 1 oF 1. pt Assignment Score: 1.00% (20 oF 20 pts] 2|) of 2|) complete In the L'.S., gross domestic product, (GDP) and gross national product (GNP) are close in value. Under what circumstances would GNP be much larger than GDP? Few foreign citizens cmrently work in the L'.S. and few foreign Ems maintain facilities in the L'.S. Many US. citizens cm’rently work in foreign countries while few foreign citizens cm’rently work in the ‘L'.S. Few foreign Ems maintain facilities in the US. while many L'.S. Ems are currently operating abroad. V All of the above would push GNP above GDP. leExercise-42 Exercise Score: 1 oF 1. pt Assignment Score: 100% [20 oF 20 p13) 20 of 20 complete Subtracting from GNP gives us Net Narional Product (LET). tranasfer payments from government sales taxes, also lmow as indirect business taxes personal income taxes if depreciation of machinerey, equipment, and bmldings leExercise- (J) Exercise Score: 1. oF ]. pt Assignment Score: 1.00% (20 oF 20 p15) 20 of 20 complete E How is Personal Income calculated? (NNP) - indirect business taxes V (National Income) - (retained earnings) - (corporate taxes) - (transfer payments) (GNP) - depreciation (NN‘P) - (indirect business taxes) - (transfer payments) ‘leExercisel2 I:J:I Exercise Score: 1 oF 1 pt Assignment Score: 1.00% (20 oF 20 pts] 20 of 20 complete [Related to the Chapter l[Ilpener] During economic expansion, would you be better off working in an industry that produces normal goods or inferior goods”? Normal goods. As the economy expands, incomes decrease. When incomes fall, people tend to substitute away from inferior goods and consume more normal goods. Inferior goods. As me economy expands, incomes increase. As income rises, consumption ofinferior goods also rises. Inferior goods. As the economy expands, incomes decrease. When incomes fall, people tend to substitute away fi'om normal goods and consume more inferior goods. V Normal goods. As the economy expands, incomes increase. As income rises, consumption ofnormal goods also rises. leExercis-313 Exercise Score: l. of 1. pt Assignment Score: 1.00% I220 0F 20 pts] 2|} of 20 complete In order for the expenditure on final goods and services to equal the total value of income received from producing goods A and services, the firm must pay out all the money it receives in the form of income to the factors of production. What are the factors of production? V Land, labor, captital, and entrepreneurship Land, labor, capital, and profit Wages, labor, capital, entreprenem'ship. Wages, interest rent and profit How does the business make a profit if all money received is paid out as income to the factors of production? Profit is a category of income; it is the return to labor and gerenally defined as what remains after entrepreneurs, interest and rent have been paid. In this model a business will never show a profit, since expenditure on final goods and services must equal the total value of income received for producing the goods and services. V Profit is a category of income; it is the return to entrepreneurship and gerenally defined as what remains after wages, interest, and rent have been paid. None of the above are correct. 1 -. a -. -. a -. a a -. a 'GG'G@@@@@@’@@@@D 1eErercisez1 Exercise Score: 1. 0F 1. pt Assignment Score: 100% (20 0F 20 pts] 2|} of 20 complete {ousehold production will tend to increase during a recession and Wfll tend to decrease during an expansion. During a recession, would the fluctuation in actual production-real GDP plus household production-be greater than or less than the fluctuation in measured GDP? V [t is mlmown. Measured GDP wi[l fall, but the change in actual production is uncertain. Measured GDP wifl fluctuate by less than actual production. Measured GDP wifl fluctuate by more than actual production They Will fluctuate by the same amount. leExereiseEE {{6} Exercise Score: 1. OF 1 pt Assignment 5cere: 1.00% (20 oF 20 pts) 20 of 20 complete If the year 2000 is the base year, what is likely relationship between nominal GDP and real GDP for the years 1995 through 1999? YWhat is the likely relationship between the two for the years 2001 through 2006'? Assume that there has been a gen era! and sustain ed increase in average price ieveis. Real GDP is greater than nominal GDP for years before 2000, and equal to nominal GDP for years after 2000. V Real GDP is greater than nominal GDP for years before 2000, and less than nominal GDP for years after 2000. Real GDP is less than nominal GDP for years before 2000, and greater than nominal GDP for years after 2000. Real GDP is equal to nominal GDP for years be “ore 2000, and less than nominal GDP for years after 2000. In the base year, real GDP is equal to nominal GDP. ...
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hw 11 - leExerciseH Exercise Score: 1. OF 1. pt Assignment...

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