Options for #1
One
Two
Three
Options for #2
Production
Intermediate
Income
Homework Answers
GDP is measured by three different and equivalent methods
Intermediate consumption is the value addition method which determines the GDP of an economy
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Options for #1
One
Two
Three
Options for #2
Production
Intermediate
Income
The measurement of GDP...
Aa Aa 2. Comparing the expenditure and value-added approaches for calculating GDP The expenditure and value-added...
Aa Aa 2. Comparing the expenditure and value-added approaches for calculating GDP The expenditure and value-added approaches for calculating GDP arrive at the same final number, but they calculate that number in different ways. To illustrate this, think about the effects of the transactions in the following story about GDP: Akshay pays Better Buy $1,000 to install a new high-definition television (HDTV) on his living room wall. He's attracted by Better Buy's guarantee that he'll be happy with the new...
The expenditure and value-added approaches for calculating GDP arrive at the same final number, but they...
The expenditure and value-added approaches for calculating GDP arrive at the same final number, but they calculate that number in different ways. To illustrate this, think about the effects of the transactions in the following story about GDP: • Zach pays Better Buy $1,100 to install a new high-definition television (HDTV) on his living room wall. He's attracted by Better Buy's guarantee that he'll be happy with the new HDTV, or he'll get his money back. • Better Buy pays...
According to the circular flow diagram shown below, GDP can be calculated in different but equivalent...
According to the circular flow diagram shown below, GDP can be calculated in different but equivalent ways. Choose all the valid methods to calculate GDP from the following EXPENDITURE(S) Money spent on goods and services FIRMS goods, services labour force HOUSEHOLDS VALUE ADDED BY FIRMS ($) = INCOME ($) Income received as wages and profits from the production of goods and services U a) By adding up all the expenditures on domestic goods. U b) By adding up incomes generated...
rm Firm B Firm C Values of Sales Intermediate goods Wages Interests payment:s Rent Profit $4,200...
rm Firm B Firm C Values of Sales Intermediate goods Wages Interests payment:s Rent Profit $4,200 (ore) S9,000 (steel $21,500 (car) $9,000 S0 $4,200 $2,000 $3,700 $10,000 $1,000 $600 $1,000 $300 $200 $9,000 $200 $500 $1,000 $21,500 $1,000 Total expenditure S4,200 HW3 (due next Wednesday, February 13,2019 at the beginning of class) Q1, Lets us consider an economy that consists of three firms (firm A, Firm B and Firm C) there is no foreign sector. Firm A mines the iron...
Question 1 1 pts According to Taylor, there are two ways to measure GDP: the value...
Question 1 1 pts According to Taylor, there are two ways to measure GDP: the value of what is produced, and the value of purchases. The relationship between these two is Purchases will exceed production Production will exceed purchases There is no stable relationship They are always equal Question 3 1 pts According to Taylor, the definition of a recession is When the economy goes down significantly When the trend of the economy is rising O When the economy goes...
Question 2 Consider an economy with two firms and a government. Firm 1 produces 10000 units...
Question 2 Consider an economy with two firms and a government. Firm 1 produces 10000 units of good X, which it sells for $20 per unit. It uses this revenue to pay $140000 in wages, $10000 in taxes, and $10000 in interest on a loan, with the rest as profits. Firm 1 sells some of its output to consumers, and some to Firm 2 as an intermediate good in their production process. Firm 2 uses good X as an input...
1.There are two approaches to measuring gross domestic product (GDP), expenditures approach and income approach. Expen...
1.There are two approaches to measuring gross domestic product (GDP), expenditures approach and income approach. Expenditures approach is comprised of consumption expenditures, investment expenditures, government expenditures plus net exports (exports minus imports). Households create income by supplying their labor to the firms. What items is the incomes approach comprised of? Hint: one item is compensation of employees. 2.Factor incomes are comprised of wages, interest, rent and capital. GDP does not measure certain items, what are they and why? What constitutes...
10. Comparing the expenditure and value-added approaches for calculatingGDP The expenditure and value-added approaches to calculating...
10. Comparing the expenditure and value-added approaches for calculatingGDP The expenditure and value-added approaches to calculating GDP arrive at the same final number, but they reach that number in different ways. To illustrate, consider the possible effects of the following set of transactions on GDP: 1. Raphael pays Better Buy $800 for a new high-definition television (HDTV) and its installation. He's attracted by Better Buy's guarantee that he'll be happy with the new HDTV or get his money back. 2....
9. In the circular flow of income, why must the value of total production in an...
9. In the circular flow of income, why must the value of total production in an economy equal the value of total income? a. Domestic expenditures on imports generally equal foreign expenditures on U.S. exports. b. People tend to spend all of their income on goods and services. c. Taxes on the production of goods and services are determined according to individual income. d. Every penny spent on a good or service must end up as someone's income. 15. A...
7. Which one of the following is an example of the circular flow model and shows...
7. Which one of the following is an example of the circular flow model and shows the interdependence of households and firms? a. The firms go to the resource market to supply resources that households demand and, in turn, provide households with the goods and services produced for the product markets. b. Households demand their resources from the firms in the factor markets and, in turn, supply in the product market the goods and services produced by firms. c. The...
Aa Aa 2. Comparing the expenditure and value-added approaches for calculating GDP The expenditure and value-added approaches for calculating GDP arrive at the same final number, but they calculate that number in different ways. To illustrate this, think about the effects of the transactions in the following story about GDP: Akshay pays Better Buy $1,000 to install a new high-definition television (HDTV) on his living room wall. He's attracted by Better Buy's guarantee that he'll be happy with the new...
The expenditure and value-added approaches for calculating GDP arrive at the same final number, but they calculate that number in different ways. To illustrate this, think about the effects of the transactions in the following story about GDP: • Zach pays Better Buy $1,100 to install a new high-definition television (HDTV) on his living room wall. He's attracted by Better Buy's guarantee that he'll be happy with the new HDTV, or he'll get his money back. • Better Buy pays...
According to the circular flow diagram shown below, GDP can be calculated in different but equivalent ways. Choose all the valid methods to calculate GDP from the following EXPENDITURE(S) Money spent on goods and services FIRMS goods, services labour force HOUSEHOLDS VALUE ADDED BY FIRMS ($) = INCOME ($) Income received as wages and profits from the production of goods and services U a) By adding up all the expenditures on domestic goods. U b) By adding up incomes generated...
rm Firm B Firm C Values of Sales Intermediate goods Wages Interests payment:s Rent Profit $4,200 (ore) S9,000 (steel $21,500 (car) $9,000 S0 $4,200 $2,000 $3,700 $10,000 $1,000 $600 $1,000 $300 $200 $9,000 $200 $500 $1,000 $21,500 $1,000 Total expenditure S4,200 HW3 (due next Wednesday, February 13,2019 at the beginning of class) Q1, Lets us consider an economy that consists of three firms (firm A, Firm B and Firm C) there is no foreign sector. Firm A mines the iron...
Question 1 1 pts According to Taylor, there are two ways to measure GDP: the value of what is produced, and the value of purchases. The relationship between these two is Purchases will exceed production Production will exceed purchases There is no stable relationship They are always equal Question 3 1 pts According to Taylor, the definition of a recession is When the economy goes down significantly When the trend of the economy is rising O When the economy goes...
Question 2 Consider an economy with two firms and a government. Firm 1 produces 10000 units of good X, which it sells for $20 per unit. It uses this revenue to pay $140000 in wages, $10000 in taxes, and $10000 in interest on a loan, with the rest as profits. Firm 1 sells some of its output to consumers, and some to Firm 2 as an intermediate good in their production process. Firm 2 uses good X as an input...
9. In the circular flow of income, why must the value of total production in an economy equal the value of total income? a. Domestic expenditures on imports generally equal foreign expenditures on U.S. exports. b. People tend to spend all of their income on goods and services. c. Taxes on the production of goods and services are determined according to individual income. d. Every penny spent on a good or service must end up as someone's income. 15. A...
7. Which one of the following is an example of the circular flow model and shows the interdependence of households and firms? a. The firms go to the resource market to supply resources that households demand and, in turn, provide households with the goods and services produced for the product markets. b. Households demand their resources from the firms in the factor markets and, in turn, supply in the product market the goods and services produced by firms. c. The...
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