Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 9, Problem 7WNG
To determine
Explain the relationship between recessionary gap, inflationary gap or long run equilibrium.
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Given the following: Ca = $450, Ig = $250, Xn = − $10, and G = $30, what is the economy’s GDP.
What is the relationship of the GDP deflator to real GDP?
To make comparisons across time or across borders, one must use the notion of a GDP deflator to convert nominal GDP into real GDP for comparisons. Nominal variables are in current dollars and have price level changes such as inflation and deflation included in them. Real variables are in constant dollars due to the factoring out of price level changes using a base year and a deflator.
What is the current nominal GDP for the US economy?
What is the current real GDP for the US economy?
If consumption is $11 trillion, investment is $2 trillion, government purchases are $3 trillion, exports are $2 trillion and imports are $3 trillion, calculate GDP. Use the formula GDP = C + I + G + (X – IM). I suggest just leaving the numbers in trillions (rather than adding in 9 extra zeroes).
Chapter 9 Solutions
Economics (MindTap Course List)
Ch. 9.1 - Prob. 1STCh. 9.1 - Prob. 2STCh. 9.1 - Prob. 3STCh. 9.2 - Prob. 1STCh. 9.2 - Prob. 2STCh. 9.2 - Prob. 3STCh. 9.3 - Prob. 1STCh. 9.3 - Prob. 2STCh. 9.3 - Prob. 3STCh. 9 - Prob. 1QP
Ch. 9 - Prob. 2QPCh. 9 - Prob. 3QPCh. 9 - Prob. 4QPCh. 9 - Prob. 5QPCh. 9 - Prob. 6QPCh. 9 - Prob. 7QPCh. 9 - Prob. 8QPCh. 9 - Prob. 9QPCh. 9 - Prob. 10QPCh. 9 - Prob. 11QPCh. 9 - Prob. 12QPCh. 9 - Prob. 13QPCh. 9 - Prob. 14QPCh. 9 - Prob. 15QPCh. 9 - Prob. 16QPCh. 9 - Prob. 17QPCh. 9 - Prob. 18QPCh. 9 - Prob. 1WNGCh. 9 - Prob. 2WNGCh. 9 - Prob. 3WNGCh. 9 - Prob. 4WNGCh. 9 - Prob. 5WNGCh. 9 - Prob. 6WNGCh. 9 - Prob. 7WNG
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- In 2019, Mr. Francis paid $10m for a house that was built in 2019 and sold that year for $8m. What value will this transaction add to GDP in 2020?arrow_forwardThe natural level of real GDP is that level ofarrow_forwardIf U.S. government statistics counted education spending as part of the investment, which of the following would rise, which would fall, and which would remain unchanged? You might use rise, fall, and stay unchanged more than once each or you might not. Consumption Investment Gross domestic productarrow_forward
- The difference between nominal GDP and real GDP is: real GDP adjusts for inflation real GDP excludes imports and exports nominal GDP adjusts for inflation nominal GDP measures actual productivityarrow_forwardIf you read in the newspaper that the United States’ 2015 real GDP declined while nominal GDP for 2015 grew, how could you explain this?arrow_forwardTrue or false GDP is a macroeconomic concept.arrow_forward
- How Real GDP is measured? Explain Real GDP of the United States at present time.arrow_forwardIdentify the following variables as more variable than GDP or less variable than GDP: (1) consumption, (2) investment, and (3) unemployment.arrow_forwardGiven the following: consumption = 430, investment = 300, government expenditure = 150 and net export = -70, what is the economy’s GDP ?arrow_forward
- Why do you think that GDP does not grow at a steady rate, but rather speeds up and slows down?arrow_forwardIf real GDP declines in a given year, nominal GDP also must decline. Do you agree? Explain your answer.arrow_forwardFor each of the following transactions that occur in their lives, identify whether it is included in the calculation of U.S. GDP as part of consumption (C), investment (I), government purchases (G), exports (X), or imports (M). Check all that apply. Transaction C I G X M The Pennsylvania Department of Transportation, a state administration, fixes potholes along PA highway 23, which feeds into the center of Conshohocken. Felix's employer upgrades all of its computer systems using U.S.-made parts. Janet's father in Sweden orders a bottle of Vermont maple syrup from the producer's website. Janet gets a new video camera made in the United States. Felix buys a sweater made in Guatemala.arrow_forward
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