Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Question
Chapter 7, Problem 14CQ
(a)
To determine
Identify whether the suffering $10,000 damage of automobile affects the current year’s
(b)
To determine
Identify whether the winning lottery affects the current year’s GDP.
(c)
To determine
Identify the share of stock and sales commission that affects the current year’s GDP.
(d)
To determine
Identify the rental payment affect the current year GDP.
(e)
To determine
Identify whether the computer service payment affect the current year’s GDP.
(f)
To determine
Identify whether the cash receive from parents will affect the current year’s GDP.
(g)
To determine
Identify whether a raise in hourly earnings and reduction in working hours affect the current year’s GDP.
(h)
To determine
Identify the earnings from Country S as an English instructor affect the current year GDP.
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Students have asked these similar questions
Classify each 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.
A. A textbook bought by a student
B. A computer purchased for a senator's office
C. New cars bought by Hertz, the car rental firm
D. Aluminum sheets bought by Boeing
1.
A is
a final good that is consumption expenditure,
B is
a final good that is government expenditure,
C is
a final good that is investment,
and D is
an intermediate good.
2.
A is
a final good that is investment,
B is
an intermediate good,
C is
a final good that is investment,
and D is
an intermediate good.
3.
A is
a final good that is consumption expenditure,
B is
an intermediate good,
C is
a final good that is consumption expenditure,
and D is
a final good that is investment.
4.
A is
a final good that is consumption expenditure,
B is
a final good…
• Holly has recently graduated from college and has bought a house that was built 50 years ago for
$100,000. She used a real estate agent to help her find and purchase the house, and the real estate agent
received 5 percent of the value of the sale, or $5,000, to be paid by the seller of the house. The value of
GDP in this case would
increase by $95,000.
increase by $105,000
increase by $5,000.
increase by $100,000.
1) Explain how GDP is used in the calculation of a recession or economic growth. What is a recession? How do you know whether an economy is growing or not?
2) Explain why intermediate goods are not counted in the calculation of GDP. What is an intermediate good?
Chapter 7 Solutions
Economics: Private and Public Choice (MindTap Course List)
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