EBK MINDTAP ECONOMICS FOR BOYES/MELVIN'
10th Edition
ISBN: 9781305387614
Author: MELVIN
Publisher: VST
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Question
Chapter 5, Problem 1E
To determine
The below table lists the stages in the production of a personal computer. Find the value of the computer in
| Stage | Value Added |
| Company Manufacture | $100 |
| Assembly | $250 |
| Wholesaler | $500 |
| Retailer | $1,850 |
Expert Solution & Answer
Answer to Problem 1E
The value of computer in the GDP is
Explanation of Solution
The real value of GDP at each stage is calculated as follows:
| Stage | Value Added | Real Value Added |
| Components Manufacture |
|
|
| Assembly |
|
|
| Wholesaler |
|
|
| Retailer |
|
|
| Total Value |
|
Hence, the value of computer in the GDP is
Economics Concept Introduction
Gross Domestic Product- Gross Domestic Product or GDP is referred to as the market value of all the services and final goods which has been produced in a period.
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Students have asked these similar questions
What is the relationship among the four expenditure components of GDP?
Consider the following data on U.S. GDP:
Year
GDP
(Billions of current dollars)
(Billions of 2012 dollars)
2014
17,521.7
16,899.8
2015
18,219.3
17,386.7
2016
18,707.2
17,659.2
2017
19,485.4
18,050.7
2018
20,494.1
18,566.4
Source: “National Economic Accounts.”U.S. Bureau of Economic Analysis.
The percentage change in nominal GDP from 2017 to 2018 was .
The percentage change in real GDP from 2016 to 2017 was .
True or False: The percentage change in real GDP from 2015 to 2016 was higher than the percentage change in real GDP from 2016 to 2017.
True or False
Explain the initial effect of each of the following events on Canada’s GDP.
a) Toby sells his used car to Maria.
b) The value of your Home Depot stock holdings decrease.
c) You use $100,000 to buy a piece of land with the intention of building a new house on it.
d) Sharon buys a new pair of jeans at a department store in another town in her province.
e) An Irish tourist drinks an American beer in a Canadian restaurant.
f) Your local car dealership reduces its inventory by offering price reductions.
g) You sell all the shares in your Canadian National Railway Company holdings.
h) Jermaine travels with Air Canada to Grenada and buys rum and spices.
i) Bickram gets a haircut and beard trimmed at his local barbershop.
j) Katherine, a retired worker, gets an increase in her Canada Pension Plan benefits.
Chapter 5 Solutions
EBK MINDTAP ECONOMICS FOR BOYES/MELVIN'
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