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- Need help with this. Thank you 1. Explain why the Government Spending (G) component of GDP falls short of actual (total) government outlays or expenditures. - If Depreciation = $479 Gross private domestic Investment (I) = $716 Government spending = $924 Imports = $547 Personal Consumption Expenditures = $2,966 Exports = $427 a. How big is the GDP? b. How big is National Income?Question 1. Please answer the following questions related to Gross domestic product (GDP). a. There are at least three ways to define or measure Gross Domestic Product (GDP), as discussed in our class. Please briefly describe these three definitions of GDP. b. Assume that total output in an economy consists of 400 apples and 600 oranges and that apples cost $1 each and oranges cost $0.50 each. The labour cost of the production is $50. In this case, what is the value of GDP?6. Limitations of GDP Although GDP is a reasonably good measure of a nation's output, it does not necessarily include all transactions and production for that nation. Which of the following scenarios are either not accounted for or measured inaccurately by either the income or the expenditure methods of calculating GDP for the United States? Check all that apply. The quality of goods available to consumers The loss of enjoyment people incur when scenic land is converted to commercial use Federal government paychecks to soldiers The import and sale of illegal drugs from South America When a U.S. company purchases and imports electronic parts from China to use to produce smartphones within the United States, this purchase increases the component of GDP while also increasing net exports by the same amount. Therefore, the in US GDP. investment purchase of electronic parts from China causes no overall change
- 6. Limitations of GDP Although GDP is a reasonably good measure of a nation's output, it does not necessarily include all transactions and production for that nation. Which of the following scenarios are either not accounted for or measured inaccurately by either the income or the expenditure methods of calculating GDP for the United States? Check all that apply. The quality of goods available to consumers O The loss of enjoyment people incur when scenic land is converted to commercial use The value of babysitting services, when the babysitter is paid in cash and the transaction isn't reported to the government O Federal government paychecks to soldiers When a U.S. company purchases and imports automotive parts from Canada to use to build cars within the United States, this purchase increases the net exports by the same amount. Therefore, the purchase component of GDP while also in US GDP. automotive parts from Canada causes5. Which component of GDP includes spending on new structures and equipment?Classify the type of expenditure in the following transactions. Tuition paid by your parents is _______. A new office building is _______. A. consumption expenditure; consumption expenditure B. investment; investment C. government expenditure; investment D. consumption expenditure; investment
- 1. In the above case study, identify TWO factors that are responsible for the rise in Japan’s Gross Domestic Product (GDP)The three ways of measuring Gross Domestic Product are the __________ approach, the ________ approach, and the __________ approach. 3 Select one: a. real GDP, nominal GDP, potential GDP b. income, expenditure, value-ad3ded c. expenditure, income, real GDP1. Define Gross Domestic Product (GDP) and discuss how it is used as a measure of living standard and the limitations of its use. 2. What other indicators (list at least 3) can be used to supplement GDP as a measure of welfare? 3. What is the difference between a final good and an intermediate good ? Give relevant examples or each if possible
- 2. Which of the following will decline in US GDP according to national income accounting? a. An decrease in government financial assistance to families for groceries and food paid for by income tax revenue b. an increase in imports from China a drop in salaries paid to soldiers in the US military с. d. an old bridge collapses and is left un-repaired and untouched the entire year е. none of the above5) Economic activities in a three-sector hypothetical economy for 2020 are given below. Compute GDP using both the expenditure approach and the factor payment approach. There is no government and no depreciation A. Agriculture: thousands of self-employed farmers. Manufacture: Sigma Auto, Inc. (a car producing company) Service: Super M (a chain of food market) B. Sigma Automobile produced 2,000 small cars, which it sold at $6,000 each, and 200 trucks, which it sold at $8,000 each. Consumers bought 1600 of the cars, and the remaining 400 cars were exported to abroad. Super Market bought all the trucks. C. Sales at Super M markets amounted to $28 million, all of it sold to consumers. D. Self-employed farmers sell all of their products to Super M. Sigma Auto Super M Farmers Wages $7,600,000 $9,000,000 $0 Interest 200,000 400,000 1,400,000 Rent 400,000 2,000,000 4,000,000 Purchase of food 14,000,0001. 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.