Explain the expenditure measure of GDP. What is the underlying assumption of this measure? Provide one example where the underlying assumption is violated. Explain the income measure of GDP. What is the underlying assumption of this measure? Provide one example where the underlying assumption is violated. Explain why we need to compute nominal GDP, real GDP, and per capita GDP. Why does every economy have a natural rate of unemployment (NRU)? Can the actual unemployment rate measured by Statistics Canada be greater or lesser than the NRU? If so why? Assume that the economy has a recessionary gap. Explain how the economy will remove this gap without government intervention. Use graphs to illustrate your answer. Assume that the economy has an inflationary gap. Explain how the economy will remove this gap without government intervention. Use graphs to illustrate your answer.
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Explain the expenditure measure of
GDP . What is the underlying assumption of this measure? Provide one example where the underlying assumption is violated. -
Explain the income measure of GDP. What is the underlying assumption of this measure? Provide one example where the underlying assumption is violated.
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Explain why we need to compute nominal GDP, real GDP, and per capita GDP.
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Why does every economy have a natural rate of
unemployment (NRU)? Can the actual unemployment rate measured by Statistics Canada be greater or lesser than the NRU? If so why? -
Assume that the economy has a recessionary gap. Explain how the economy will remove this gap without government intervention. Use graphs to illustrate your answer.
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Assume that the economy has an inflationary gap. Explain how the economy will remove this gap without government intervention. Use graphs to illustrate your answer.
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