Which of the following statements is TRUE? Select one: a. Potential GDP is the same as real GDP. b. Real GDP fluctuates around potential GDP. c. When all of the economy's resources are fully employed, the value of production is called real GDP. d. Potential GDP fluctuates around real GDP.
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- K An economy is based on three sectors, agriculture, manufacturing, and energy. Production of a dollar's worth of agriculture requires inputs of $0.30 from agriculture, $0.30 from manufacturing, and $0.30 from energy. Production of a dollar's worth of manufacturing requires inputs of $0.30 from agriculture, $0.20 from manufacturing, and $0.20 from energy. Production of a dollar's worth of energy requires inputs of $0.20 from agriculture, $0.30 from manufacturing, and $0.30 from energy. Find the output for each sector that is needed to satisfy a final demand of $31 billion for agriculture, $50 billion for manufacturing, and $12 billion for energy. The output of the agricultural sector is billion dollars. (Round the final answer to three decimal places as needed. Round all intermediate values to six decimal places as needed.)Classify each of the following items as a final good or an intermediate good, and classify the expenditure on each final good as consumption expenditure or investment: Item 1. New aircraft bought by Southwest Airlines Item 2. Jet engines bought by Boeing Item 3. The ringtone you bought today Item 4. A new apartment building Item 1 is _______ and item 2 is _______. A. an intermediate good; an intermediate good B. a final good that is investment; an intermediate good C. a final good that is investment; a final good that is consumption expenditure D. an intermediate good; a final good that is consumption expenditure Item 3 is _______ and item 4 is _______. A. a final good that is consumption expenditure; a final good that is investment B. a final good that is consumption expenditure; an intermediate good C. a final good that is investment; a final good that is investment D. a final good that is…a. Consider an economy which produces and sells, among a host of other things, 100 million T‑shirts a year. The average T‑shirt begins life when a farmer plants seeds she put away last year, waters them, and harvests the cotton, then sells the cotton to a mill for $0.75, which sells the fabric to a T‑shirt factory for $1.50, which sells its T‑shirts to a wholesaler for $5, who sells it to Nordstrom for $10, which finally sells it to you for $17. Determine the impact of T‑shirts on annual GDP by calculating the value added of the entire production process. b. Now, calculate the amount spent on T‑shirts in a year if 100 million T‑shirts are sold, each for $17. How does this compare to the amount calculated through the value‑added method?
- Classify each of the following items as a final good or service or an intermediate good or service, and identify which is a component of cons government expenditure on goods and services. A. A new limousine for the president B. Banking services bought by a student C. New airplanes bought by United Airlines D. Packing boxes bought by Amazon.com O 1. A is an intermediate good, B is a final service that is consumption expenditure, C is a final good that is investment, and D is a final good that is investment. O2. A is a final good that is government expenditure, B is a final service that is consumption expenditure, C is a final good that is consumption expenditure, and D is a final good that is investment. O 3. A is an intermediate good, B is a final service that is investment, C is a final good that is investment, and D is an intermediate good. O4. A is a final good that is government expenditure, B is a final service that is consumption expenditure, C is a final good that is investment,…For each of the following products state if it is a final or intermediate good and explain why? A brick, a cell phone, and a barrel of crude oil.QUESTION TWOSuppose that the economy of Mwaliteta Republic has the following data for some economic variables. Assume that Mwaliteta Republic has a population of 500,000 people.Variable Amount in million ZMWExpenditure on Non-durable goods 98Non-residential fixed investment 79Central government expenditure 60Local government expenditure 82Expenditure on durable goods 82Expenditure on services 99Export expenditure 60Inventory Investment 5Depreciation 4Property income from abroad 12Indirect taxes 12Residential fixed investment 42Personal income tax…
- One of the following best explains consumption spending Select one: a. Spending on final consumer goods b. Spending on capital goods c. None of the option are correct d. Spending on infrastructureWhat is the concept of the "income-expenditure model" used to analyze in economics? A. International trade balances B. Macroeconomic equilibrium and fluctuations in an economy C. The distribution of income in society D. Microeconomic market structures.1. Explain with your own words the definition of Gross Domestic Product. 2. How does the growth rate of real GDP contribute to an improved standard of living? 3. Use the following data to answer the question. The table lists some macroeconomic data for the United States in 2008. Item Billions of dollars Wages paid to labor 8,000Consumption expenditure 10,000Net operating surplus 3,200Investment 2,000Government expenditure 2,800Net exports –700Depreciation 1,800 3a) Calculate U.S. GDP in 2008.
- a. Draw a circular-flow diagram. Identify the parts of the model that correspondto the flow of goods and services and the flow of dollars for each of thefollowing activities. i. Paul purchases a pair of shoes for $30. ii. Shannon receives a salary of $1,500 per week at the supermarket whichshe works. iii. Honda Limited receives $20,000 for the sale of a sports utility vehicle. iv. Mark earns $2,000 from his 15 percent ownership of Apple stock.1. Draw a circular-flow diagram. Identify the parts of the model that correspond to the flow of goods and services and the flow of dollars for each of the following activities. a. Selena pays a storekeeper $1 for a liter of milk. b. Stuart earns $4.50 per hour working at a fast-food restaurant. c. Shanna spends $30 to get a haircut. d. Salma earns $10,000 from her 10% ownership of Acme Industrial.Classify each of the following items as a final good or service or an intermediate good or service, and identify which is a component of consumption expenditure, investment, or government expenditure on goods and services. A. A new limousine for the president B. A DVD bought by a household C. Steel sheets bought by General Motors D. A new apartment building O 1. Ais a final good that is government expenditure, B is a final good that is consumption expenditure, C is an intermediate good, and D is a final good that is investment. O 2. A is an intermediate good, B is a final good that is investment, C is an intermediate good, and D is a final good that is investment. O 3. Ais a final good that is government expenditure, B is a final good that is consumption expenditure, Cis a final good that is consumption expenditure, and D is a final good that is consumption expenditure. O 4. Ais an intermediate good, B is a final good that is consumption expenditure, C is an intermediate good, and D is…