Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Chapter 7, Problem 5CQ
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Economics: Private and Public Choice (MindTap Course List)
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- List some of the reasons why economists should not consider GDP an effective measure of the standard of living in a county.arrow_forwardIn the US, the Bureau of Economic Analysis (BEA) reports the following information about the US economy for the years 2010 - 2016. All dollar figures are in trillions and have been rounded to the nearest trillion. Some entries are missing from the table. Let's see if you can figure out one of these missing values. 2010 2011 2012 2013 2014 2015 2016 Current-dollar GDP 15.0 15.5 16.2 16.8 17.5 18.2 18.7 GDP in chained 2012 dollars 15.8 16.5 16.9 17.7 chained growth rate of GDP (%) 2.6 1.6 2.5 2.9 1.6 What was real GDP in 2015? a) 16.9 x 1.029 = 17.4b) 16.9 x 1.025 = 17.3c) (16.9 + 17.7)/2 = 17.3d) 17.5 x 1.029 = 18.0arrow_forwardWhat is a real GDP? Why do economists prefer to use that as a measurement over regular GDP?arrow_forward
- If nominal GDP rose, does that mean that production had to increase as well? Why or why not? What about if real GDP increased? Why is it important to use real GDP when comparing changes over time?arrow_forwardSuppose an economy consists of only three goods, as shown in this Table: What is the nominal value of GDP in 2020 and 2021?arrow_forwardWhat components of GDP tend to decline significantly during recessions (particularly during the 2008 recession), and what GDP components rise during expansion?arrow_forward
- Are there problems with GDP that should be fixed?arrow_forwardHey, I need help with the following problem divided into seven smaller parts: Calculate nominal GDP for 2011 and 2012. Using 2011 as the base year, calculate real GDP for 2011 and 2012. Based on your answer from part (b), by what percentage did real GDP grow between 2011 and 2012? Now, calculate real GDP for 2011 and 2012 using 2012 as the base year. Based on your answer from part (d), by what percentage did real GDP grow between 2011 and 2012? Using 2011 as the base year, what was the GDP deflator in 2011 and 2012? Based on your answer from part (f), by what percentage did prices change between 2011 and 2012? Thank you in advance!arrow_forward
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