Economics (7th Edition) (What's New in Economics)
7th Edition
ISBN: 9780134738321
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 21, Problem 21.3.7PA
To determine
Verifying the statement related to real GDP.
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Students have asked these similar questions
What were the approximate levels ($) of real GDP in the 2nd and 3rd quarters of 2020? (HINT: Use your estimates of real GDP growth to calculate the levels.)
2020:Q2 16,958
2020:Q3 18,777
2020:Q2 18,650
2020:Q3 18,902
2020:Q2 17,303
2020:Q3 18,584
2020:Q2 18,260
2020:Q3 19,343
Consider the following hypothetical data for the U.S. economy in 2018 (all amounts are in trillions of dollars; see pages 179–182).Consumption 11.0 Indirect business taxes .8 Depreciation 1.3 Government spending 3.8 Imports 2.7 Gross private domestic investment 4.0 Exports 2.5e. Based on the data, what is GDP? NDP? NI?f. Suppose that in 2019, exports fall to $2.3 trillion, imports rise to $2.85 trillion, and gross private domestic investment falls to $3.25 trillion. What will GDP be in 2019, assuming that other values do not change between 2018 and 2019?
In 2022, Tom spent $70,000 renovating his house. In the same year, he sold his house to a couple from Bacchus Marsh for $850,000. As part of the sale, Tom paid $17,000 for real estate agent fee, $8,000 for advertising fee and $95,000 for capital gain tax.
Considering all of the above numbers, how much would GDP in 2022 increase by?
A) $850,000, which is how much Tom sold the house for
B) $95,000
C) $190,000
D) $0, GDP would be unchanged because the sale of this already established house is considered the sale of a second-hand good.
Chapter 21 Solutions
Economics (7th Edition) (What's New in Economics)
Ch. 21 - Prob. 21.1.1RQCh. 21 - Prob. 21.1.2RQCh. 21 - Prob. 21.1.3RQCh. 21 - Prob. 21.1.4RQCh. 21 - Prob. 21.1.5PACh. 21 - Prob. 21.1.6PACh. 21 - Prob. 21.1.7PACh. 21 - Prob. 21.1.8PACh. 21 - Prob. 21.1.9PACh. 21 - Prob. 21.1.10PA
Ch. 21 - Prob. 21.1.11PACh. 21 - Prob. 21.1.12PACh. 21 - Prob. 21.1.13PACh. 21 - Prob. 21.1.14PACh. 21 - Prob. 21.2.1RQCh. 21 - Prob. 21.2.2RQCh. 21 - Prob. 21.2.3RQCh. 21 - Prob. 21.2.5PACh. 21 - Prob. 21.2.6PACh. 21 - Prob. 21.2.7PACh. 21 - Prob. 21.2.8PACh. 21 - Prob. 21.2.9PACh. 21 - Prob. 21.2.10PACh. 21 - Prob. 21.2.11PACh. 21 - Prob. 21.2.12PACh. 21 - Prob. 21.2.13PACh. 21 - Prob. 21.2.14PACh. 21 - Prob. 21.2.15PACh. 21 - Prob. 21.2.17PACh. 21 - Prob. 21.3.2RQCh. 21 - Prob. 21.3.3RQCh. 21 - Prob. 21.3.4PACh. 21 - Prob. 21.3.5PACh. 21 - Prob. 21.3.6PACh. 21 - Prob. 21.3.7PACh. 21 - Prob. 21.3.8PACh. 21 - Prob. 21.3.9PACh. 21 - Prob. 21.1RDECh. 21 - Prob. 21.2RDECh. 21 - Prob. 21.3RDECh. 21 - Prob. 21.2CTE
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- Briefly explain whether production of each of the following goods is likely to fluctuate more or less than the real GDP does during the business cycle, and why. Ford F-150 trucks McDonald’s Big Macs Huggies diapers Boeing passenger aircraftarrow_forwardPlease explain how a rise in the household saving rate can cause a fall in GDP?arrow_forwardFor the following question , please indicate whether current GDP of the United States will be affected and, if so, by how much .In each case, indicate also which component(s) of GDP will be affected and by how much Sally is a U.S. citizen who works in germany .. Her current annual salary is $200,000 and she sends $40,000 back to her family in colorado every year. This year Sally bought $400 worth of new goods made in the U.S. online and spent another $80 in shipping costs from the U.S. to France.arrow_forward
- Suppose that the real GDP of a country was $90 billion in the first quarter of 2021 and $100 billion in the second quarter of 2021, the BEA reported that the U.S. economy grew % when annualized?arrow_forwardChina’s real GDP increased 6.9 percent in the first quarter of 2017 from a year earlier.Investment grew by 9.2 percent and retail sales by 10.9 percent. In current prices, GDPincreased by 11.8 percent from a year earlier.1. Explain how China’s real GDP can grow at a 6.9 percent rate when consumption andinvestment grew faster than 6.9 percent. 2. Explain why the growth rate of GDP in current prices does not provide informationabout how quickly the economy is really growing.arrow_forwardDescribe briefly how GDP returns to its potential level.arrow_forward
- If you read in the newspaper that the United States’ 2015 real GDP declined while nominal GDP for 2015 grew, how could you explain this?arrow_forwardCore chapter 1.2 will help with this question. Do not include the dollar sign in your answer. Fruitland has a very simple economy: it produces just apples and oranges. It has no imports and exports Apples Oranges 100 Quantity in year 1 Price in year 1 Quantity in year 2 Price in year 2 50 $1.00 $0.80 80 120 $1.25 $1.60 Using the table above, what was Fruitland's nominal GDP in year 1? Answer:arrow_forwardAn economy has been producing two goods, Apps and Banking for a couple of years, 2021 and 2022. The prices and quantities of the goods are in the table below \table[[, Y2021, P2021, Y2022, P2022], [Apps, 26, 13, 24, 15], [Banking ,62, 7, 61, 7]] Let's adopt 2021 as the base year. In it, the economy's GDP was $772. Find the 2022 's nominal GDParrow_forward
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