4. Classify cach 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: Banking services bought by a student. New cars bought by Hertz, the car rental firm. Newsprint bought by USA Today. The purchase of a new limo for the president. New house bought by Al Gore

4. Classify cach 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: Banking services bought by a student. New cars bought by Hertz, the car rental firm. Newsprint bought by USA Today. The purchase of a new limo for the president. New house bought by Al Gore

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Complete questions 5-6
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1.1. What is the US GDP for the first quarter and second quarter of 2020? What is the personal consumption expenditures for the first quarter and second quarter of 2020?
What is investment? A. Expenditure on goods produced but not consumed during the period under consideration B. Expenditure on goods produced and consumed during the period under consideration C. Expenditure on goods by the government. D. Expenditure on wages
2. Activities included (and not included) in the calculation of GDP The gross domestic product (GDP) of the United States is defined as the all in a given period of time. Based on this definition, indicate which of the following transactions will be included in (that is, directly increase) the GDP of the United States in 2020. 2020 GDP Included Excluded Scenario An accountant starts a client's 2020 tax return on April 14, 2021, finishing it just before midnight on April 15, 2021. Treetopplers, a U.S. lumber company, produces wood at a plant in Oregon on September 25, 2020. It sells the wood to Buildit and Partners, a developer, for use in the production of a new house that will be built in the United States in 2020. (Note: Focus exclusively on whether production of the wood increases GDP directly, and ignore the effect of production of the new house on GDP.) Fastlane, a Japanese automobile company, produces a sedan at a plant in Indiana on December 14, 2020. A family buys the sedan on…
Classify 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 O 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 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 O 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 D. a final good that is government expenditure; an…
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If household spend $105 billion on goods and $95 billion on services. How much in revenues do businesses receive in the product market?
a. Consider an economy which produces and sells, among a host of other things, 100 million T‑shirts a year. The average T‑shirt begins life when a farmer plants seeds she put away last year, waters them, and harvests the cotton, then sells the cotton to a mill for $0.75, which sells the fabric to a T‑shirt factory for $1.50, which sells its T‑shirts to a wholesaler for $5, who sells it to Nordstrom for $10, which finally sells it to you for $17. Determine the impact of T‑shirts on annual GDP by calculating the value added of the entire production process. b. Now, calculate the amount spent on T‑shirts in a year if 100 million T‑shirts are sold, each for $17. How does this compare to the amount calculated through the value‑added method?
1. Complete this chart. ***Remember, you are looking at the change in income and spending. ( Income $20,000 $40,000 $60,000 $80,000 Expenditures MPC N/A $11,000 $25,000 $35,000 $41,000 MPS N/A
2. Which of the following is NOT included in the calculation of GDP? a) Investment spending b) Government spending
1. What is the distinction between Nominal GDP and Real GDP? Which is more important in terms of satisfying humans wants? Why? 2. Use list to compute GDP from the Expenditures approach. Personal Consumption expenditures $600 Transfer payments $15 Consumption of fixed capital $20 Interest $11 Exports $15 Government purchases $85 Compensation of employees $225 Imports $18 Net private domestic investment $65