Homework Answers
Ans.- (C)
Real income is the income after adjusting it for inflation.
Nominal income is the income without adjusting it for inflation.So difference between nominal and real income arises due to inflation (change in price level).
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the difference between real and nominal income arises because
of the existence of
6) The difference...
1. What is the difference between "nominal" and "real" national income? 2. Explain the "business cycle"...
1. What is the difference between "nominal" and "real" national income? 2. Explain the "business cycle" and its relevance to macroeconomics 3. Explain the concept of "full employment". Does this mean there are no unemployed persons in the economy? Why? How does the "consumer price index" measure inflation and why is this important? What is the difference between "growth" and "fluctuations" and why is this important? 4.
25. What is the difference between Nominal and Real GDP? (2 pts) A GDP based on...
25. What is the difference between Nominal and Real GDP? (2 pts) A GDP based on the prices that prevailed when the output was produced i that has been deflated or inflated to reflect changes in the price level is call
Please answer this ASAP, Thanks: The difference between real and nominal Gross Domestic Product (GDP) is...
Please answer this ASAP, Thanks: The difference between real and nominal Gross Domestic Product (GDP) is that: Real GDP is measured in dollars of the day, while nominal GDP utilizes a base year. Nominal GDP removes general price movements, while real GDP does not. Nominal GDP reflects the dollars of the day and includes general price increases, while real GDP removes the inflationary effects of general price movements. All of the above. None of the above.
7. The difference between nominal Gross Domestic Product and real Gross Domestic Product a.is that nominal...
7. The difference between nominal Gross Domestic Product and real Gross Domestic Product a.is that nominal Gross Domestic Product includes only the values of final goods and services, while real Gross Domestic Product includes the values of both final and intermediate goods and services. b. is that real Gross Domestic Product includes the value of all goods sold in the country (whenever they were produced) during the period, while nominal Gross Domestic Product includes the value of all goods produced...
6. Explain the difference between "real" and "nominal" effects concerning monetary policy and its effect on...
6. Explain the difference between "real" and "nominal" effects concerning monetary policy and its effect on the economy.
Questions # 7,8,9, 10 and 11 Value Added 100 $250 $ 500 5 1.850 the difference...
Questions # 7,8,9, 10 and 11
Value Added 100 $250 $ 500 5 1.850 the difference between GDP and each of the What Wat is the GDP for this economy 8. What is the GNP for this economy? 9. What is the NNP for this economy? 10. What is the national income for this economy? 11. What is the gross investment in this economy? 12. Indirect business taxes and capital consumption allowance are not income, yet they are included in...
4. The difference between expenditure and income approach to measure GDP resides in: A) Expenditure approach...
4. The difference between expenditure and income approach to measure GDP resides in: A) Expenditure approach address the question “Who gets income”, while income approach “Who purchases GDP” B) Expenditure approach counts compensation of employees, rents, interest, proprietor’s income and corporate profit, while income approach counts consumption, investment, government spending and net export C) From the spending side 70% of national income is paid in wages and benefits, while from income side 72% consists of consumer expenditures D) The expenditure...
unearned revenue arises because the business receives goods or services before payment has been made True...
unearned revenue arises because the business receives goods or services before payment has been made True or false retirement compensation is a benefit because the employer sets aside money for the employees future retirement True or false gross pay is the total amount of salary,wages,commissions,and bonuses earned by an employee during a pay period,after taxes or any other deductions True or false the old age,survivors,and disability insurance component of FICA tax is imposed on the entire amount of an individual...
Billions of Dollars 80 45 40 15 160 375 35 Investment Capital consumption allowance (depreciation) Exports...
Billions of Dollars 80 45 40 15 160 375 35 Investment Capital consumption allowance (depreciation) Exports Imports Government purchases Consumption Indirect business taxes Social insurance taxes Corporate profit taxes Undistributed corporate profits Transfer payments Personal taxes Compensation of employees Corporate profits Rental income (of persons) Net interest Proprietors' income Income earned from the rest of the world Income earned by the rest of the world 4 110 455 90 25 25 80 40 The five components of GDP from the...
Question 2 (a) Explain the difference between nominal exchange rate and real exchange rate (6) As mentioned in clas...
Question 2 (a) Explain the difference between nominal exchange rate and real exchange rate (6) As mentioned in class, the Big Mac Index is a numerical tool for assessing disparities in consumer purchasing power between countries. Suppose that the Big Mac costs 7.50 Canadian dollars in Canada and 5.50 US dollars in the US. Suppose that the nominal exchange rate is 1.2 Canadian dollars to 1 US dollar. (i) Calculate the real exchange rate. (ii) Is the Canadian dollar undervalued...
1. What is the difference between "nominal" and "real" national income? 2. Explain the "business cycle" and its relevance to macroeconomics 3. Explain the concept of "full employment". Does this mean there are no unemployed persons in the economy? Why? How does the "consumer price index" measure inflation and why is this important? What is the difference between "growth" and "fluctuations" and why is this important? 4.
25. What is the difference between Nominal and Real GDP? (2 pts) A GDP based on the prices that prevailed when the output was produced i that has been deflated or inflated to reflect changes in the price level is call
6. Explain the difference between "real" and "nominal" effects concerning monetary policy and its effect on the economy.
Questions # 7,8,9, 10 and 11
Value Added 100 $250 $ 500 5 1.850 the difference between GDP and each of the What Wat is the GDP for this economy 8. What is the GNP for this economy? 9. What is the NNP for this economy? 10. What is the national income for this economy? 11. What is the gross investment in this economy? 12. Indirect business taxes and capital consumption allowance are not income, yet they are included in...
Billions of Dollars 80 45 40 15 160 375 35 Investment Capital consumption allowance (depreciation) Exports Imports Government purchases Consumption Indirect business taxes Social insurance taxes Corporate profit taxes Undistributed corporate profits Transfer payments Personal taxes Compensation of employees Corporate profits Rental income (of persons) Net interest Proprietors' income Income earned from the rest of the world Income earned by the rest of the world 4 110 455 90 25 25 80 40 The five components of GDP from the...
Question 2 (a) Explain the difference between nominal exchange rate and real exchange rate (6) As mentioned in class, the Big Mac Index is a numerical tool for assessing disparities in consumer purchasing power between countries. Suppose that the Big Mac costs 7.50 Canadian dollars in Canada and 5.50 US dollars in the US. Suppose that the nominal exchange rate is 1.2 Canadian dollars to 1 US dollar. (i) Calculate the real exchange rate. (ii) Is the Canadian dollar undervalued...
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