Economics:
10th Edition
ISBN: 9781285859460
Author: BOYES, William
Publisher: Cengage Learning
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Question
Chapter 4, Problem 6E
To determine
The four sectors of the economy and the types of spending associated with each sector along with their magnitude and example.
Expert Solution & Answer
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Students have asked these similar questions
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 infrastructure
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 textbook bought by a student
B. A computer purchased for a senator's office
C. New cars bought by Hertz, the car rental firm
D. Aluminum sheets bought by Boeing
1.
A is
a final good that is consumption expenditure,
B is
a final good that is government expenditure,
C is
a final good that is investment,
and D is
an intermediate good.
2.
A is
a final good that is investment,
B is
an intermediate good,
C is
a final good that is investment,
and D is
an intermediate good.
3.
A is
a final good that is consumption expenditure,
B is
an intermediate good,
C is
a final good that is consumption expenditure,
and D is
a final good that is investment.
4.
A is
a final good that is consumption expenditure,
B is
a final good…
Van and Amy Cho live in Conshohocken, PA. Amy's father, Carlos, lives in Sweden.
For each of the following transactions that occur in their lives, identify whether it is included in the calculation of U.S. GDP as part of consumption (C),
investment (I), government purchases (G), exports (X), or imports (M). Check all that apply.
Transaction
Amy's father in Sweden orders a bottle of Vermont maple syrup from the producer's website.
Amy gets a new refrigerator made in the United States.
The Pennsylvania Department of Transportation, a state administration, fixes potholes along PA highway
23, which feeds into the center of Conshohocken.
Van's employer upgrades all of its computer systems using U.S.-made parts.
Van buys a sweater made in Guatemala.
C
I
0
G
0
0
X
|
M
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Similar questions
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- The table below shows economic activity for a tiny country. Using the expenditure approach determine the following. Activity Total Value (dollars) 600,000 Families buy groceries Electronics company sells HD projectors to households 100,000 5,000 Personal trainer gives a Zumba class Custard stand sells pistachio ice cream 2,000 Police department buys new cars 500,000 300,000 Mayor leads creation of a new budget for education company builds a new factory Elevator-construction 600,000 Local businessperson purchases corn from Mexico 400,000 Sports-gear company sells hockey gloves to Canadian team 200,000 Bike store sells five used carbon-fiber bikes 200,000 Local stockbroker executes trades for clients 2,000,000 Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign front of those numbers. a. Consumption = $707000. b. Investment = $2600000. c. Government purchases = $ 800000 d. Net exports $200000arrow_forwardGross domestic product (GDP) is a measurement of the total value of all goods and services produced in the United States over a given time period. It is used by economists, government officials, market forecasters and others to gauge the overall health of the U.S. economy. How do consumers drive the nation's GDP?arrow_forwardClassify each of the following items as a final good or an intermediate good, and identify whether it is a component of consumption expenditure, investment, or government expenditure on goods and services: Item 1. Packing boxes bought by Amazon.com. Item 2. Starbuck's grande mocha frappuccino bought by a student. Item 3. A new limousine for the president. Item 4. New airplanes bought by United Airlines. Item 1 is and item 2 is A. an intermediate good; a final good that is consumption expenditure B. a final good that is consumption expenditure; a final good that is consumption expenditure O C. a final good that is consumption expenditure; a final good that is investment D. an intermediate good; a final good that is investment Item 3 is and item 4 is O A. an intermediate good; an intermediate good B. a final good that is government expenditure; a final good that is investment O C. an intermediate good; a final good that is investment O D. a final good that is government expenditure; an…arrow_forward
- Calculate the four components of expenditure and GDP for the following economy using data from the table below. Instructions: Enter your responses as whole numbers. GDP Data $600 Consumption expenditures Exports $75 $200 Government purchases of goods and services Construction of new homes and apartments Sales of existing homes and apartments Imports Beginning-of-year inventory stocks End-of-year inventory stocks Business fixed investment Government payments to retirees Household purchases of durable goods $100 $200 $50 $100 $125 $100 $100 $150 Consumption expenditures: Investment expenditures: $| Government Purchases: $ Net Exports: GDP:arrow_forwardWhich of the following questions would be studied in the area of microeconomics? Select one: a. What determines the number of hours an individual works? b. Do interest rates affect net exports? c. Will an increase in government spending cause inflation? d. What portion of total spending comes from households in the economy?arrow_forwardK 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.)arrow_forward
- Calculate the four components of aggregate expenditure and GDP for the following economy using data from the table below.Instructions: Enter your responses as whole numbers. If you are entering any negative numbers, be sure to include a negative (-) sign in front of those numbers. GDP Consumption expenditures $550 Exports $100 Government purchases of goods and services $200 Construction of new homes and apartments $200 Sales of existing homes and apartments $200 Imports $50 Beginning-of-year inventory stocks $100 End-of-year inventory stocks $50 Business fixed investment $100 Government payments to retirees $100 Household purchases of durable goods $150 Consumption expenditures: $ Investment expenditures: $ Government Purchases: $ Net Exports: $ GDP: $arrow_forwardA country has just one resource - labor - that it can use to produce two goods, books and clothing. At first the country has 10 million workers, and each worker can produce either 2 books or 5 units of clothing per day. Suppose the country wants to produce 8 million books. Suppose the price of a book is $10, and the price of a unit of clothing is $20. Using this information and your answer from the last question, calculate the country's GDP (measured in dollars per day). Enter your answer as a number in the space below. (For example, if your answer is $3.75 million, enter it as 3750000 in the space below.)arrow_forwardIn the expenditure approach, the total expenditures of the following entities are calculated, except a. Gross taxable incomes b. Net Exports c. Gross private domestic investment d. Government expendituresarrow_forward
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