1. Using the following table and the principles of the circular flow model, determine this economy's GDP. Briefly describe the strategy used to arrive at GDP. Is this economy at a general equilibrium? Why or why not? If this economy has a money stock of $800.00, what is the flow? Remember, economists may multiply stock times flow to arrive at GDP. Show your work. Consumption $1,500. Savings 75. Таxes 100. Capital Purchases 100. Inventory Decreases 50. Government Purchases 200. Transfer Payments 50. Exports 75. Imports 150.

1. Using the following table and the principles of the circular flow model, determine this economy's GDP. Briefly describe the strategy used to arrive at GDP. Is this economy at a general equilibrium? Why or why not? If this economy has a money stock of $800.00, what is the flow? Remember, economists may multiply stock times flow to arrive at GDP. Show your work. Consumption $1,500. Savings 75. Таxes 100. Capital Purchases 100. Inventory Decreases 50. Government Purchases 200. Transfer Payments 50. Exports 75. Imports 150.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

c Suppose the real GDP in an economy is currently $320 billion, C is $160 billion, I is $50 billion, G is $32 billion, and Nx is $-20 billion. What can you say about the state of equilibrium in this economy? Will its real GDP rise, fall, or stay the same? Explain.
1. What is GDP? 2. What is net export? 3. What is the difference between Microeconomics and Macroeconomics? 4. What is consumption? 5. What are investments? 6. Write the equation for GDP
Suppose an economy consists of only three goods, as shown in this Table: What is real GDP in 2020 and 2021? How much (in percentage terms) did real GDP change between 2020 and 2021?
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.
Use the expenditure approach to calculate GDP. GDP is _____
U.S. durable goods orders boosted by aircraft The Commerce Department reported that orders for durable goods increased 2.1 percent in July. Orders for Boeing aircraft rebounded. Source: Financial Times, August 26, 2019 Explain the process by which an increase in durable goods orders at a constant price level changes equilibrium expenditure and real GDP. A planned increase in durable goods is an increase in planned investment. When planned investment increases, _______. A. the economy moves production into investment from consumption expenditure, government expenditure on goods and services, and exports. Real GDP decreases B. real GDP cannot change unless the price level also changes C. real GDP increases by an amount equal to the change in investment. Disposable income decreases to make up for the increase in investment so that the economy returns to its long-run equilibrium D. real GDP initially increases by an amount equal to the change in…
3. Categories of expenditures Shen and Valerie Ferrari live in Swarthmore, PA. Valerie's father, Antonio, 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 Shen's employer upgrades all of its computer systems using U.S.-made parts. Valerie gets a new video camera made in the United States. The state of Pennsylvania repaves highway PA 320, which goes through the center of Swarthmore. Valerie's father in Sweden orders a bottle of Vermont maple syrup from the producer's website. Shen buys a bottle of Italian wine. OOOoo 0 I 00000 G 00 000 X 00000 M OC 0 0 0 0
Problem 3: Different GDP Techniques Consider the following mini-economy composed of two firms (Firm 1 and Firm 2). Firm 1 is a farm and grows $4,000 of Wheat. Firm 1 keeps $1,000 of wheat in a silo to sell next year. Firm 1 then sells its remaining $3,000 of wheat directly to Firm 2. Firm 1 uses the $3,000 it receives from Firm 2 to pay $2,000 to its workers, $200 on interest payments in outstanding debts, and $800 in taxes. Firm 2 is a bakery and uses the $3,000 of wheat that it purchases to bake bread and sell it. Firm 2 produces $7,000 of bread, selling $2,000 to the Government and selling $5,000 to private consumers. Firm 2 pays its workers $1,000, pays $1,000 in taxes, and the owner keeps the rest of the money remaining as profits. 13. Calculate GDP for this mini-economy using the value-added approach. What is the contribution of each firm to this total GDP? 14. Calculate GDP for this mini-economy using the expenditure approach. What is the contribution of each firm to this total…