Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Chapter 21, Problem 4.1P
To determine
To discuss how one can include environmental costs in
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Principles of Economics (12th Edition)
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- What items are included in the calculation of GDP using the income approach ?arrow_forwardI don't know how many of these you can answer, but these questions are just true/false questions and I've been struggling with them. The sale of GE Washing Machines to East Coast Appliance would not be counted in GDP. Julia Jones' monthly Social Security payment would not be included in GDP. If unsold inventories = $ 200 in 2019 and $ 300 in 2020, then the amount to go into GDP for this category for 2020 would be $ 500. Personal Consumption Expenditures account for about 25% of GDP. Spending on Consumer Durable Goods tends to be very stable from year to year. Sales of used goods are included in GDP at 35% of their original sale price. Investment in new technology (e.g., software) is included today in GDP in “Gross Private Investment.” Government purchases of goods and services at all levels of government (federal, state, and local) are included in GDP. Construction and sales of new housing would be included in “Personal Consumption Expenditures” in the durables goods…arrow_forwardWhich type of GDP would you use to measure the value of that economy for the individual? arrow_forward
- How might you calculate GDP for schools? What products would you include? Which ones would you exclude?arrow_forwardDo you think that economists should place a dollar value on “goods” and “bads” when computing GDP?arrow_forwardA country has just one resource - labor - that it can use to produce two goods, books and clothing. At first the country has 10 million workers, and each worker can produce either 2 books or 5 units of clothing per day. Suppose the country wants to produce 8 million books. Suppose the price of a book is $10, and the price of a unit of clothing is $20. Using this information and your answer from the last question, calculate the country's GDP (measured in dollars per day). Enter your answer as a number in the space below. (For example, if your answer is $3.75 million, enter it as 3750000 in the space below.)arrow_forward
- Which of the following are included in GDP calculations? a. Cleaning services performed by Molly Maid Corporation b. Lawn-mowing services performed by a neighborhood child c. Drugs sold illegally on a local street comer d. Prescription drugs manufactured in the United States and sold at a local pharmacy e. A rug woven by hand in Turkey f. Air pollution that diminishes the quality of the air you breathe g. Toxic-waste cleanup performed by a local company h. Car parts manufactured in the United States for a car assembled in Mexico i. A purchase of 1,000 shares of IBM stock j. Monthly Social Security payments received by a retireearrow_forwardGross domestic product (GDP) is a measurement of the total value of all goods and services produced in the United States over a given time period. It is used by economists, government officials, market forecasters and others to gauge the overall health of the U.S. economy. How do consumers drive the nation's GDP?arrow_forwardTired of paying for an uber to and from work every day, a millenial decides to start biking to and from work three times a week. If each one-way uber ride costs her $8.50, what is the overall impact of her decision on GDP? a. GDP would decrease by $51 b. GDP would increase by $51 c. GDP would decrease by $16 d. GDP would not changearrow_forward
- Which of the following transactions should or should not be counted in GDP? Answer Yes or No and briefly explain your answer. Answers without explanation will not be considered in grading, even if they are correct. a. You buy a pair of new cowboy boots on a trip to Texas b. You buy a pair of vintage cowboy boots from your cousin in El Paso c. A cat burglar sells $10,000 of stolen jewelry to a fence d. Amazon issues $1 billion worth of new shares e. GM purchases $100 million worth of tires from Firestone f. A private company builds a new road in Memphis Y g. Stay-at-home parents provide an estimated $500 million of child care servicesarrow_forwardAre illegal drug sales counted in GDP?arrow_forwarda) Give the definition of GDP and explain what items are not included in its calculation? What is the current environment in the USA and Australia? b) Define unemployment and its measurement. What is the current environment in the USA and Australia?arrow_forward
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