Macro HW. - January 28, 2008 Principles of Macro Homework...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
January 28, 2008 Principles of Macro Homework #1 1. A positive statement is a statement of fact. It does not have any feelings or emotions that would sway the opinion of what is being talked about. A normative statement is one where feelings and emotions do take into effect and normally expresses how things should be. Positive statements get used more than normative statements because they express a fact and are impossible to refute because it is just information. This gets focused upon by economists because if a positive statement is argued then there is a surefire way to prove and disprove it as well as to further the amount of knowledge on the topic (i.e. study and test). The reason economist use normative approaches as well as positive ones is so they can think about future policies if their economic approach is taken. This can be seen in the Reagan approach to the economy by saying that by giving the rich tax cuts that money should trickle down. With only taking a positive viewpoint it would limit the economists to make no great strides in the field and be forced to only regurgitate the same old arguments. 2. a. Growth rate of consumption- 8302.2-7852.8= 449.4 billion of chained 2000 dollars Growth rate of investment- 1859.9-1865.3= -5.4 billion of chained 2000 dollars Growth rate of government consumption and investment- 1859.9-1865.3= -5.4 billion of chained 2000 dollars. Growth rate of net exports- -533.1-(-604.1) = 71 billion of chained 2000 dollars Growth rate of GDP- 11,658.9-11,074.3= 584.6 billion of chained 2000 dollars b. The nominal GDP went from 12558.8 billion dollars in 2005’s 3 rd quarter to 13970.5 billion dollars in 2007’s 3 rd quarter thus giving it a growth rate of 1411.7 billion dollars or a 10.1% increase. This can be attributed to the increase in the aggregated price level because of the rise in inflation and the lack of the use of constant dollars
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 5

Macro HW. - January 28, 2008 Principles of Macro Homework...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online