Essay on Problem Set 1

-The nation’s GDP is a good measure of its economic well being and progress because it represents the total value of all goods and services produced in an economy, and what a country produces and what it consumes are nearly identical.

Problem #1: Using either a graph or table (Refer to page 22 for help with graphs and tables) use two goods to construct a production possibilities curve. Clearly explain what a variety of different points on the curve mean. What would make the curve expand or contract? Why is efficiency lost at the extremes, as when substantially more of one good and very little of another is produced?

Question 33 Consider the following data that gives the quantity produced and unit price for three different goods across two different years to answer the questions that follow: Assume that the base year is 2012. What was the real GDP in 2013?

For Investment B: (40 – 5)/ 30= 1.16 standard units= close to 88% to get the 40 million in

K2B concludes that the investment must earn at least an 8% return. Compute the net present value of this investment. (Round the net present value to the nearest dollar.)

Problem Set 2 is to be completed by 11:59 p.m. (ET) on Monday of Module/Week 4.

____ 16. If two goods are ____, then an increase in the price of one leads to ____ in the quantity demanded of the

A. Assume that country A and country B decide to use half of the resources in the production of each good. Indicate the points of the maximum output of each good on the graphs for each country as point A under such resource use.

GDP, or gross domestic product, is the sum total value of all goods and services produced by a country within a given year. To achieve this sum, everything produced and exported, all of the money spent by consumers and government, investments, and many other contributing factors are calculated and combined. A nation’s GDP is used as the main indicator of the economic status of that nation. In general, the higher a country’s GDP is, the greater the health of that country’s economy. However, GDP is not as helpful or accurate a calculation as “real GDP”. Real GDP is a term that refers

GDP is the market value of all final goods and services produced within a country in a given period of time. GDP is basically the measure of a nation's total income and is an important tool in explaining a single society's economic well-being (Mankiw, 2009).

Gross Domestic Product, also known as GDP, is defined as the dollar value of all final goods and service produced within the border of a country during a specific period of time, typically in one year. GDP measures the value for the whole country, and it also changes quickly. We can take a look at the trends of US GDP in the website of the U.S. Bureau of Economic Analysis.

Question 13 If the supply curve of a factor of production facing a competitive firm is perfectly elastic, then from the firm's point of view: (a) none of the factor's earnings is necessary transfer payment (b) all of the factor's earnings is producer surplus (c) none of the factor's earnings is rent (d) all of the factor's earnings is rent

b. Again analyzing his past data, Larry does a runs test. He finds the following results.

13) Assume that a government purchases $85,000 of inventory for the General Fund during the year. The General Fund began the year with an inventory balance of $15,000 and ended the year with a balance of $35,000. The General Fund uses the consumption method of inventory accounting and a perpetual inventory system. The General Fund should report

12) Suppose that we force the production of one unit of product A. The new objective function value will be