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 th Which of the following scenarios are either not accounted for or measured inaccurately by either the income or the expenditure meth GDP for the United States? Check all that apply. The costs of overfishing and other overly intensive uses of resources O Federal government paychecks to soldiers The value of babysitting services, when the babysitter is paid in cash and the transaction isn't reported to the government The leisure time enjoyed by households When a U.S. company purchases and imports wood from Brazil to use to build new houses within the United States, this purchase inc component of GDP while also net exports by the same amount. Therefore, the pur in US GDP. from Brazil causes

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.

C and D

Read the news clip, then answer the following question. The statement that total sales by businesses were up 0.3 percent means that GDP because OA. Increased by 0.3 percent; GDP is a record of the value of all production B. decreased by 0.3 percent; "total sales by businesses are sales of intermediate goods and services OC. did not change by 0.3 percent, GDP measures production of all final goods and services and "total sales by businesses includes final and intermediate goods and services OD. increased by less than 0.3 percent; we need to subtract retail sales of 1.3 percent from the total sales by businesses to eliminate double counting OE. increased by more than 0.3 percent; "total sales by businesses includes only sales of intermediate goods and services Expansion remains slow The Commerce Department reported that retail sales increased 1.3 percent in Net exports were up 0.8 percent in the first quarter and inventories held by businesses rose by 0.3 percent in June. Total sales by…