Is the value of the production of intermediate goods missing from GDP?Yes, because GDP only counts the value of finished goods.No, because when GDP is calculated the value of intermediate goods and finished goods are summed together.Yes, because GDP is a measure of the sale of goods, not the production of goods.No, because the value of these goods is part of the value of some other finished goods.

No, because the value of these goods is part of the value of some other finished goodsRemember that…

Answered: Is the value of the production of…

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter11: Gross Domestic Product

Section: Chapter Questions

Problem 2SQ

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Which of the following statements best describe how economists calculate GDP? a. Economists at the Census bureau collect data from surveys sent to consumers, private firms and government agencies and add them up on a yearly basis. b. Economists at the Bureau of Economic Analysis pull together data on sales, imports, exports, government purchase and investments from various government sources every 3 months. c. Economists at the Bureau of Labor Statistics collect data from surveys sent to consumers, private firms and government agencies and add them up every 3 months. d. Economists at the Congressional Budget Office calculate GDP for a given year by adjusting the previous year’s GDP with inflation. Which statement best describes the difference between Nominal and Real GDP? a. Nominal GDP is Real GDP that has been adjusted to remove the distorting effects of inflation. b. Real GDP is calculated using current market prices, while Nominal GDP is calculated using the…
Which of the following are production activities that are included in GDP? Which are not? a. Mr. King performs the service of painting his own house instead of paying someone else to do it. This activity is GDP b. Mr. King paints houses for a living. This activity is GDP. c. Mrs. King earns income from parents by taking baby photos in her digital photography studio. This activity is GDP. d. Mrs. King takes digital photos of planets and stars as part of her astronomy hobby. This activity is GDP. e. E*Trade charges fees to process Internet orders for stock trades. This activity is GDP. f. Mr. Ho spends $10,000 on shares of stock via an Internet trade order. This activity is Mr. Ho pays a $10 brokerage fee. This activity is GDP g. Mrs. Ho receives an income support payment from the government. This activity is GDP. h. Ms. Chavez makes a $300 payment for an Internet-based course on stock trading. This activity is ▼ GDP. i. Mr. Langham sells a used laptop computer to his neighbour. This…
a)A caterpillar tractor is made by a U.S firm producing in the United States. Is this production counted in GDP? b) A Toyota Avalon is made by a Japanese firm producing in the United States. Is this production counted in GDP? c) Brooks running shoes are made by a U.S firm producing in China. Is this production counted in GDP?
Although GDP is a reasonably good measure of a nation's output, it does not necessarily include all transactions and production for that nation. Which of the following scenarios are either not accounted for or measured inaccurately by either the income or the expenditure methods of calculating GDP for the United States? Check all that apply. a. The variety of goods available to consumers b. The costs of air and water pollution c. Expenditures on federal highways d. The value of babysitting services, when the babysitter is paid in cash and the transaction isn't reported to the government When a U.S. company purchases and imports electronic parts from China to use to produce MP3 players within the United States, this purchase increases the (a. government purchases, b. investment, c. consumption) component of GDP while also (a. increasing, b. decreasing) net exports by the same amount. Therefore, the purchase of electronic parts from China causes (a. no change, b. an…
Which of the following would NOT be counted as a final good for inclusion in GDP? A: a. sheet of glass produced this year and ending up in the inventory of a retail store b. sheet of glass purchased by a commercial builder of a new home c. home that is built this year but is not sold d. piece of glass bought by a consumer to fix a broken window
Describe the components of Gross Domestic Product (GDP) and how GDP is calculated. Discuss the limitations of GDP as a measure of economic well-being.
Which of the following is included in Gross Domestic Product (GDP)? Select one: a. the buying and selling of securities b. government transfer payments c. private transfer payments d. the sale of used goods e. None of these
Which of the following is least likely to be included in calculating GDP by the sum-of-value-added method? a. The cash paid by a customer to purchase bread from the retailer b. Money spent by a construction worker on materials to build. c. Rental costs incurred by a retailer in storing goods for sale d. The money spent by a farmer in transporting the wheat to the miller
A farmer produces milk, which he sells to a mill for 1000 tk. The mill turns the milk into cream, which he sells to a baker for 1500 tk. The baker turns the cream into a cake, which he sells to consumers for 2000 tk. Consumers eat the cake.a. What is GDP in this economy? Explain.b. What is the total value added of the three producers in this economy? Does this example suggest another way of calculating GDP?
GDP is defined as the market value of all final goods and services produced within a country in a given period of time. As we covered in the previous question, intermediate goods are not included in GDP. However, that is not the only production that is left out of GDP. Explain why some final goods and services, other than intermediate goods, are not included in GDP.
Consider an economy where three goods are produced: strawberries, ice creams and coolers. Of these three goods, only strawberries and ice cream are consumer goods, that is, only strawberries and ice creams are purchased by consumers. Coolers, the third type of good, are also final goods, but they are purchased by businesses only, not households. The total quantities (produced and consumed) and prices are presented in the table below: (a) Calculate nominal GDP for the years 2017, 2018 and 2019. (b) Calculate real GDP, expressed in dollars of the year 2017, for the years 2017, 2018 and 2019 Using 2018 as the base year, calculate the CPI inflation rate between the years 2017 and 2018, and between 2018 and 2019.
Which of the following will be counted as part of the U.S.'s GDP for a given year? Select one: a. An All-Terrain Vehicle produced by Honda in Timmonsville, South Carolina b. Cleaning service by an illegal immigrant that is not reported to the IRS c. A whopper burger produced by Burger King in Tel Aviv, Israel d. Tools purchased by a professional plumber at Home Depot e. An antique car that is sold at an auction

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