Exam 10: Measuring a Nations Income: Part A

Last quarter Newton computers produced 3,000 computers.Two thousand of these computers were sold to households,750 were sold to businesses,and 250 were added to Newton's inventory.How many of the computers should have been included in last quarter's GDP?

What are transfer payments,and how do they affect the calculation of GDP?

Are sales of used goods included in GDP? Explain why or why not.Hint: Remember how GDP is defined.

Which component of GDP includes spending on new structures and equipment?

Calculate the inflation rate for a country where the GDP deflator rises from 120 to 165.

What are exports,and how are they different from imports?

In the circular flow diagram what are the three types of payments from firms to factors of production? Is the sum of these payments greater than,less than,or equal to GDP?

Explain how GNP differs from GDP.

Refer to Figure 23-2.List the locations associated with the flow of inputs and outputs.

GDP excludes most of two types of production.List one.

Write the formula for calculating a country's inflation rate using the GDP deflator.

Explain why it is the case that the value of intermediate goods produced and sold during the year is not included directly as part of GDP,but the value of intermediate goods produced and not sold is included directly as part of GDP.

Nominal GDP is $15 trillion and real GDP is $10 trillion.What is the GDP deflator? Show your work.

List the four components of GDP.

Define gross domestic product.

Consumption is $7 trillion,investment is $1.5 trillion,government expenditures are $2 trillion,government transfer payments are $1 trillion,exports are $1.50 trillion and imports are $1.25 trillion.What is GDP?

Refer to Figure 23-2.Identify the location of firms and households.

Calculate GDP for an economy with exports of $5 trillion,investment of $1.5 trillion,consumption spending of $11 trillion,imports of $6 trillion,and government purchases of $3 trillion.

Explain the pattern seen between GDP per person and quality of life measures such as life expectancy,literacy,and Internet usage.

Foreign countries buy $1.2 trillion of U.S.goods and services.U.S.residents purchase $1.8 trillion of foreign goods and services.What is net exports?