*4. Assume that a country produces only two goods,automobiles and fast PCs. In year 1, automobiles cost$20,000 each and the PCs cost $3,000 each; 1,000 auto-mobiles and 10,000 PCs are produced. In year 2, theprice of automobiles has increased to $22,000; becausea new, even faster type of PC is about to be intro-duced, the price of fast PCs has fallen to $700. In year2, 1,000 automobiles and 15,000 PCs are produced.(a) Fill in the following table.Year 1Year 2Nominal GDP(Total of current-dollarexpenditures)Real GDP(i) at fixed year 1 prices(ii) at fixed year 2 prices(b) Using the technique of chain-weighting, calculatethe percentage change in real GDP between year 1and year 2.(c) Calculate the GDP deflator for year 2.

Year 1 Automobiles Cost = $20,000 each PC's cost = $3,000 each Quantity for Automobiles = 1,000…

Answered: *4. Assume that a country produces only…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Please note I have completed some of this myself, however I need you to finish it up. Thanks! Suppose that annual output in year 1 in a 3-good economy is 3 quarts of ice cream, 1 bottle of shampoo, and 3 jars of peanut butter. In year 2, the output mix changes to 5 quarts of ice cream, 2 bottles of shampoo, and 2 jars of peanut butter. If the prices in both years are $4 per quart for ice cream, $3 per bottle of shampoo, and $2 per jar of peanut butter, what was the economy’s nominal GDP in year 1? Show the calculation. Year one (3*$4)+(1*$3)=$12+$3+$6=$21 Recall that GDP is the core measure of an economy's health. Nominal GDP (also known as current–dollar economic statistics) is not adjusted to account for any price changes. To calculate nominal GDP (the value of all final goods and services evaluated at current-year prices) you have to use the formula: Nominal GDP= P*Q. To get a real picture of a nation's economic growth economists prefer using real GDP. To calculate real…
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Suppose that there are only two goods produced in an economy haircuts and banking services. Prices, quantities, and the number of workers occupied in the production of each good for year 1 and for year 2 are given in the table below Year 1 Year 2 P₁ Q₁ W₁ P₂ Q₂ W₂ Haircuts 7 120 50 9 120 50 Banking 7 190 50 9 220 60 Nominal GDP in year 1 is S (Enter your response to the nearest dollar) Nominal GDP in year 2 is S (Enter your response to the nearest dollar) Using year 1 prices, real GDP in year 2 is $ (Enter your response to the nearest dollar) The growth rate of real GDP is % (Round your response to two decimal places) The rate of inflation using the GDP deflator is % (Round your response to two decimal places) Using year 1 prices, real GDP per worker in year 1 is $ (Round your response to two decimal places) Using year 1 prices, real GDP per worker in year 2 is $ (Round your response to two decimal places) The growth rate of labor productivity between year 1 and year 2 for the whole…
Question 888M In 2018, the U.S. GDP was approximately $ 2.5 trillion. However, India is growing faster than theU.S.a. If the U.S. economy grows at 3% per year, in what year will the U.S. GDP double to $40trillion? (Hint—use the Rule of 70).b. If India’s economy grows at 7% per year, in what year will its GDP double to $ 5 trillion Full explain this question and text typing work only thanks
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