This image illustrates the circular flow of income and expenditure within an economy, highlighting the interactions between different sectors.1. **Government**: - Government purchases of goods and services amount to $100. - Taxes collected from households total $100.2. **Households**: - Consumer spending is $650. - Households receive wages, profits, interest, and rent from factor markets, totaling $750.3. **Factor Markets**: - Factor markets supply firms with required inputs at a cost of $750, represented as wages, profits, interest, and rent.4. **Firms**: - Firms use inputs from factor markets to produce goods and services and generate a Gross Domestic Product (GDP). - They supply wages, profits, interest, and rent to the factor markets amounting to $750.5. **Markets for Goods and Services**: - This market handles the exchange of goods and services utilizing consumer spending ($650), government purchases ($100), and exports ($20). 6. **Rest of the World**: - Exports to other countries total $20, while imports from the rest of the world also total $20, indicating a balance in trade.The various arrows indicate the flow of money between these entities, demonstrating the interconnectedness of economic activity and the flow of income throughout the system. 1. At right is a simplified circular-flow diagram for the economy of Micronia. (Note that there is no investment in Micronia.)a. What is the value of GDP in Micronia?b. What is the value of net exports?c. What is the value of disposable income?

We are going to find the disposable income, Gross domestic product to answer this question.

Answered: YAt right is a simplified circular-flow…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Jane spends $1,200 on a used computer. How will this calculation effect GDP? A.) Consumption will rise and GDP will rise B.) Investment will rise and GDP will rise C.) Since the good was not currently produced consumption will not rise, neither will GDP D.) The GDP deflator will rise but not real GDP
U.S. macroeconomic data are among the best in the world. Given what you learned in the Clear It Up "How do statisticians measure GDP?", does this surprise you, or does this simply reflect the complexity of a modern economy? Suppose GDP was modified to include the value - positive or negative - of changes in environmental quality. How could this be done accurately?
3. For each of the following events, what is the likely effect on GDP? a. an increase in government military spending due to the war in Ukraine b. Prostitution is made legal across the country. c. A miller sells flour to a baker. d. A miller sells flour to a final consumer. e. There is a large decline in the consumption of cigarettes. f. There is a large decline in the consumption of heroin. g. There is an increase in divorce rates.
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What impact would each of following have in on real gdp ?would economic well being increase or decrease as a result? A. Averege, people in a country decide to increase the number of hours they work by 5%. b. Spending on Homeland security increase in response to terrorist attack
Assessment tions ts 0% 0% ! 1 0% 0% Q A 1 N a. First, calculate the change in GDP by adding up every dollar spent on final goods. b. Next, calculate the change in GDP by adding up every dollar's worth of output produced by detailing the value added at every stage of production. c. Finally, calculate the change in GDP by adding up every dollar of income earned. $ 54 0% C Sizing Up the Economy Using GDP - End of Chapter Problem Dan spent $200 on a new computer monitor that he purchased from a local store. The local store had bought it from an area wholesaler for $150. The area wholesaler had bought it from the manufacturer for $85. The manufacturer bought raw materials that cost $10 to produce the monitor. For the raw-materials provider, the $10 was pure profit. This monitor also had cost the manufacturer $65 in wages, the area wholesaler $20 in wages, and the local store $15 in wages. Calculate how much GDP changed as a result of this purchase using each of the three ways to measure…

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YAt right is a simplified circular-flow diagram for the economy of Micronia. (Note that there is no investment in Micronia.) a. What is the value of GDP in Micronia? b. What is the value of net exports? c. What is the value of disposable inçome?